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Does anyone have any links or know specifically where I can find information on this question:
We can elect to deduct state and local income tax OR state and local sales tax from our federal tax calculation ... however, when moving mid year to a state with no income tax, can one elect to deduct the state income tax for the first part (while resident of the taxing state) and simultaneously elect, for the second part of the year, to deduct the state sales tax? E.G. moving from MD to TX in June.
From what I've read online at the IRS site, it seems to be a mutually exclusive choice and no reference is given to this scenario, which must be common.
Maybe there is a page that talks to this buried somewhere, or another website where someone asked the question, but it is particularly challenging to google effectively (with double reference to taxes picking up links regarding the general choice available) and I am looking for help finding a credible/knowledgable source.
A good accountant or a reputable on-line tax program will guide you through this when the time comes. Been there, done that. Husband moved in January (new job)~I stayed behind for 6 months (finished job). Sold house in one state, bought house in another state. I had job hunting expenses and moving expenses for the new job that weren't covered (his was a corporate/company move but they didn't cover relocation for me except for household goods). Because we were residents of two states that year (for 4 months) but I worked for 6 months~we just bit the bullet that year and had our taxes done.
We went from state with no income to one that does - Hubby in February, me in June, but for me I get paid based on the job I did in the state that does not. We will have ours professionally done.
I prefer to use tax software. I paid for a CPA for one time to "play it safe" on an item, and got a whopping bill. After reviewing, I could have just used the software to figure it out, so lesson learned... I'd like to get the answers myself and use CPA's if there is something more complicated that will need some dedicated knowledge. This one is a question that should be simple to answer.
I've asked this elsewhere...will post here when I get answer.
The answer (not definitive) that I have gathered so far is that the election of which way to go is 100% one way or 100% the other with no provision for those who move between jurisdictions mid year. To maximize your benefit you will need to move in January or December (or, perhaps if you are moving at company expense, you can negotiate compensation for this).
To me, this is par for the course when it comes to how the jerks in Congress and the WH think through the rules and their implications before they enact them.
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