Income Taxes on Massachusetts job (Brattleboro: credit, service, living)

[arel]

Question: If I live in Vermont and work in Massachusetts, would I have to pay Vermont income tax, Massachusetts income tax or both?

A New Hampshire job is one thing, since there is no income tax there. But both Vermont and Massachusetts, I think, have income taxes.

If I worked in New Hampshire, would there be special fees for working there in addition to Vermont income tax?

[nhyrnut]

If you work in NH, you would just have to pay VT income tax. NH has no fee or tax as of yet. As for Paying both VT and MA taxes, I think you would. I know people who work in Mass from NH, and they pay Mass Income taxes. VT and Mass Might have some form of agreement for this. But being how both states love to tax there people to death I doubt it.

[Dwatted Wabbit]

I'm afraid you're correct, nhyrnut. Our superiors can never get enough of our money. It's for our own good, of course.

[arel]

Do you mean, that if I were to live in Vermont and work in Massachusetts, I'd pay full Vermont income tax plus full Massachusetts income tax, in addition to my federal income tax?

Or would I pay half the Vermont tax and half the Massachusetts tax or some other fractions of the respective state taxes?

If I would have to pay full state income taxes in two states, that is simply an untenable situation. I can't imagine people do it. Unless they have no choice. Or unless the job in Massachusetts is extremely important to them for career purposes or vocational passion. Or unless the salary is such that it compensates for being taxed to death.

[ab8mi]

It will not work out to double taxes, usually most states have agreements on this but it will be more than working and living in the same state. Check with a local tax professional most will answer this question for free.

[arel]

Thanks. Good advice.

Last time I was in Brattleboro, someone suggested I look for work in Greenfield, because Greenfield is close by and Massachusetts has more resources than Vermont does.

I think I would rather work in the state I live in, if this increased tax burden is an issue.

[harry chickpea]

"Pennsylvania, Maine, Massachusetts, and Vermont all extend a tax credit to their residents for income taxes paid to other States. "
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[arel]

I checked the citation. Thanks.

I don't really understand or have the patience to decipher the legalese. But I get the impression that I would have to pay all of Massachusetts' tax, and then Vermont would subtract that amount from its own tax. So, if the MA bill were higher, I would pay more than I would if I only paid VT taxes, and if the MA were lower, I would still have to pay the difference in VT taxes. If they were the same, then I'd be paying my income tax to benefit MA rather than VT.

Corrrect? Or did I misinterpret?

[harry chickpea]

Sounds about right. You might want a CPA to verify that if it is a major concern.

[arel]

Well, in a way it makes sense to pay your income tax in the state you work in. In that state, you are making your income, and using their resources to support you. That's why I was advised to look for a job in Greenfield - because Massachusetts has better social service resources.

But, in the state you live in, you are also consuming resources, and you spend at least half of your time there, even if you are sleeping for much of it.

I also don't think it is fair that you have to pay out more tax money if you live in one state and work in another.

Whatever, I could also work in New Hampshire, but something tells me that Massachusetts is a better place to work. I could be wrong, though.