Several taxes can apply during the same year. Start with three facts: where you lived, where you worked, and which taxes your employer or payer withheld.
Key points
- A federal return does not replace a state or local return that applies to you.
- Some states do not impose a broad individual income tax, but residents may still pay other state and local taxes.
- Check every place where you lived and physically worked during the tax year.
- Payroll taxes such as Social Security and Medicare differ from federal, state, and local income tax withholding.
- Sales tax varies by location and item, and stores often add it at checkout.
- Homeowners may pay property tax through a direct bill or mortgage escrow. Renters usually do not receive a property-tax bill; landlords may reflect property-tax costs in rent.
The Main Tax Layers
These layers use different rules and agencies. A payment to one agency does not settle a separate obligation to another agency.
Federal Income Tax
The IRS administers federal income tax. Employers often withhold federal income tax from employee pay. Other payers may report income without withholding enough tax to cover the final amount.
A federal income tax return compares the tax calculated under federal rules with payments and credits on the account. Withholding counts as a payment. The result may be a refund, a balance due, or no payment either way.
Your federal filing requirement can depend on income type and amount, filing status, age, dependency status, self-employment, tax residency, and other rules. Read Taxes for Newcomers for the broader filing and document overview.
State Income Tax
Each state sets its own income-tax system. A state may use different definitions, forms, deductions, credits, due dates, and residency categories from the federal system. Some states also let cities or other local governments impose an income tax.
A state without a broad individual income tax is not tax-free. Sales tax, property tax, business tax, fuel tax, fees, or other state and local charges may still apply.
Use each official state tax site to answer:
- Does the state tax the income you received?
- Does it treat you as a resident, part-year resident, or nonresident?
- Does work performed in the state create a return or withholding issue?
- Does the state have a credit or reciprocity rule for tax paid elsewhere?
- Does a city, county, or other locality have a separate rule?
- Which form, deadline, payment method, and extension rule apply?
If you're in your state
Use the official tax agency for the state where you lived and each state where you worked. Find agency links through the IRS directory of state government websites or USA.gov's state tax page. State forms, deadlines, residency definitions, and reciprocity rules can change, so verify the rule for the tax year you are filing.
Living And Working In Different States
You may need to check more than one state's filing and withholding rules if you moved, crossed a state line for work, worked remotely, or took a temporary assignment. The address on your employer's records does not provide the full answer. Record where you lived and where you performed the work.
Location and withholding check
0 of 5 doneOne state may give a credit for income tax paid to another state. Two states may have a reciprocity agreement that changes withholding or filing steps. These rules can reduce double taxation, but they do not apply to every state, tax, worker, or situation.
Remote work deserves a separate check. The state where you sat while doing the work may matter, and some states apply special sourcing rules. Ask payroll which state it used, then compare that treatment with both states' official guidance.
Payroll Taxes
"Payroll tax" and "income tax withholding" describe different lines on a pay stub.
- Social Security and Medicare taxes fund federal programs and appear as separate deductions for many employees.
- Federal income tax withholding is a payment toward federal income tax.
- State and local income tax withholding may appear when those rules apply.
- Employers also pay some employment taxes that do not come out of an employee's net pay.
Withholding does not prove that you filed the right return or paid the exact final amount. It records money sent through payroll. Read Understanding Your First Paycheck to review these lines on a pay stub.
Sales Tax
States and local governments decide which purchases they tax and which rates apply. The result can vary by city, county, type of product, or service. A purchase that is taxable in one place may receive different treatment elsewhere.
Shelf and menu prices often exclude sales tax. Check the final total before you pay, especially when comparing prices or working within a fixed budget.
Property Tax
Local governments commonly impose tax on real estate. A homeowner may receive the bill from a local authority or pay money into mortgage escrow so the loan servicer can pay the bill. A renter usually does not receive the owner's property-tax bill, but the landlord may account for that cost when setting rent.
Some states or localities also impose taxes or fees connected with vehicles or other personal property. A registration charge and a property tax are not the same thing. Check the motor vehicle agency and local tax authority before deciding what a bill covers.
Common Mistakes
Decision Rules
| Situation | Practical rule |
|---|---|
| You lived and worked in one state all year | Check that state's official filing rules and any local income tax where you lived or worked. |
| You moved during the year | Check the old state and the new state for part-year or nonresident rules. Keep exact move dates. |
| You lived in one state and worked in another | Check both states for nonresident filing, credits, and reciprocity. Do not assume withholding settled both. |
| Payroll withheld for the wrong state | Contact payroll, save the correction request, and check both states' instructions for recovering or paying tax. |
| Your state has no broad individual income tax | Check for federal filing, local rules, and other state taxes. The lack of one tax does not remove the others. |
| You had self-employment or contractor income | Check federal self-employment and estimated-tax rules, then check every relevant state and locality. |
| Your residency or work location is unclear | Collect dates and records before filing. Ask the official agencies or a qualified professional who handles multi-state cases. |
Costs And Timing
Federal, state, and local deadlines may differ. Extensions, disaster relief, fiscal-year filing, and nonresident rules can also change the date or form. Verify each agency's deadline for the tax year involved.
An extension to file may not extend the time to pay. The federal extension rule does not control a state's extension or payment rule, so check them separately.
Collect W-2s, 1099s, pay stubs, prior returns, move records, leases, work calendars, and tax notices before you start. If you use tax software, confirm that it supports every required state or local return and your tax residency. A product that prepares a standard resident return may not support nonresident alien or complex multi-state situations.
Preparation fees can rise with each added state return or special form. Ask what the quoted price includes before you provide sensitive documents or authorize filing.
What To Do Next
- Write down every state where you lived and physically worked, with dates.
- Compare those locations with state and local withholding on pay stubs and W-2s.
- Open the IRS site and each official state or local tax agency site that applies.
- Confirm that your software or preparer supports all returns and your tax residency.
- Save location records, tax forms, filed returns, payment confirmations, and agency notices.
Related Guides
- Taxes for Newcomers
- Understanding Your First Paycheck
- How to Get a Social Security Number
- How to Protect Your Personal Information
Sources
This guide uses official or primary sources for rules and government steps. Local rules may still vary. (Last checked: September 13, 2026)
- IRS: Check if you need to file a tax return
- IRS: Understanding employment taxes
- IRS: State government websites
- USA.gov: How to pay and get help with state and local taxes
- Consumer Financial Protection Bureau: What is an escrow or impound account?
- USA.gov: State and local governments
- IRS: Publication 519, U.S. Tax Guide for Aliens
- IRS: Exempt individual - Who is a student