Tax ? – Live In Wisc. but work in Minnesota

My daughter has recently moved from Duluth Minnesota to Superior Wisc. For now at least she is going to continue to work in Minnesota. Just curious how that all works on Taxes? do you file and pay for tax’s in the state you live or the state you work? Just getting info. to see if there is anything I need to have her do different. I told her to make sure she updates her address at her place of employment and assume if anything is different they will take care of it.

My understanding is that she will have to file state income tax in both states as MN and WI do not currently have state tax reciprocity.

https://www.revenue.wi.gov/Pages/FAQS/ise-mnrecipro.aspx

Her employer will withhold MN income tax, then get tax credits for WI which should offset all or most taxes paid. The only question is if she has other forms of income tax that may need to be paid, then she’ll also need to pay WI.

She should talk to a CPA.

You need to file in both states. You should pay into both states or WI will charge you a penalty for not paying throughout the year.

I’m the opposite, live in MN and work in Superior, and that is how it is, filing taxes in both states.

waldo9190 wrote:

I’m the opposite, live in MN and work in Superior, and that is how it is, filing taxes in both states.

You only file income taxes in MN though dont you? I was always confused by this if you actually pay income taxes in both states.

CaptainMusky wrote:

<div class=”d4p-bbt-quote-title”>waldo9190 wrote:</div>
I’m the opposite, live in MN and work in Superior, and that is how it is, filing taxes in both states.

You only file income taxes in MN though dont you? I was always confused by this if you actually pay income taxes in both states.

Income taxes in both states. I usually end up getting some back in WI but having to pay in MN.

That is perplexing to me. You didnt have income in WI??? Thats like double dipping but leave it to the government.

As others mentioned she will have to file in both states.
My whole career has been working in multiple states other than the one you reside in. It’s great when the two states reciprocate and the state you live in has the taxes taken out of.
My accountant charges me $200 for every state I have to file in.

So it sounds like she will have to file in both state’s. I’m still a little unclear of how its effects the tax paid. Its can’t be that you pay the full tax amount in both states. That would be double taxation at its finest. I guess I will figure it out next tax season. I may have a chance to ask my account about it soon as I have to call him about something else anyway. Maybe this next tax season is the year I let her start doing her own taxes.

fishthumper wrote:

I guess I will figure it out next tax season.

If she is in college or just out of college, she is old enough to figure it out on her own. A little online research should clear it up, or TurboTax/her CPA should be able to answer it easily for her. Not trying to be rude, but the sooner young adults start figuring out adult problems, the better off they will be. If she is still on your taxes, then it would be a question for you to research or your CPA.

She won’t pay double tax. I am assuming MN tax rate is higher than Wisc so she won’t pay in a dime to Wisconsin. Depending on dependents and what she claims on a W4 will determine what she would pay in or get back at the end of the year from MN. Both states have state income tax so it’s easier.

It gets crappy in a hurry if you are a Mn resident work in a no income tax state that doesn’t reciprocate with Mn or you don’t fill out a reciprocity form. I have learned that one the hard way.

I’m not sure what the rules are out east but I work in North Dakota and live in Minnesota and only file and pay Minnesota state taxes. I’ve never had to file had to file in North Dakota.

BigWerm wrote:

<div class=”d4p-bbt-quote-title”>fishthumper wrote:</div>
I guess I will figure it out next tax season.

If she is in college or just out of college, she is old enough to figure it out on her own. A little online research should clear it up, or TurboTax/her CPA should be able to answer it easily for her. Not trying to be rude, but the sooner young adults start figuring out adult problems, the better off they will be. If she is still on your taxes, then it would be a question for you to research or your CPA.

Glad you said it.that was my thought. Helping a kid is one thing but she sounds plenty old enough to call and ask the tax place these questions and have her answer within 5 minutes

Karry Kyllo wrote:

I’m not sure what the rules are out east but I work in North Dakota and live in Minnesota and only file and pay Minnesota state taxes. I’ve never had to file had to file in North Dakota.

Minnesota and North Dakota have reciprocity with each other.

I was just working in North Dakota last week and had MN taxes taken out.

A while back (10-15 years?) Minnesota and Wisconsin had a reciprocity agreement but Minnesota bailed on it because they were getting the short end of the stick.

Yes, she’ll have to file for both states, but really only pay in once.

The big kicker is unemployment.

Hopefully her employer will pay into Minnesota Unemployment Insurance, so if she ever loses her job she’ll get the MN rate (which is about twice the amount of the WI rate)

While she should be able to do her own taxes, I would consult with a tax person in the area. Once her wages are set, she should be able to take out enough and then after 6 months or so, I would return to understand if there needs to be adjustments to wages being taken out, whether that needs to be more taken out or if enough is being taken out. You don’t want the government using your money, you want to be using your own!!!

Mark

Well, that was entertaining. For some reason, I’ve never thought of going to a fishing forum for tax advice……..

It’s my understanding that Minnesota and Wisconsin are going to have reciprocity again. I thought I read somewhere that it was gonna happen again. Been working in mn and living in Wisconsin for the past 15 years and yes for the most part it’s wash but it’s not and you pay more at the accountants office.

B-man wrote:

A while back (10-15 years?) Minnesota and Wisconsin had a reciprocity agreement but Minnesota bailed on it because they were getting the short end of the stick.

Yes, she’ll have to file for both states, but really only pay in once.

The big kicker is unemployment.

Hopefully her employer will pay into Minnesota Unemployment Insurance, so if she ever loses her job she’ll get the MN rate (which is about twice the amount of the WI rate)

I am curious how MN was getting the short end of the stick.

MN does have reciprocity with Texas and Texas is a no income tax state.
In 2019 and 2020 I worked down there and had MN taxes taken out.

Ron wrote:

Well, that was entertaining. For some reason, I’ve never thought of going to a fishing forum for tax advice……..

A lot of smart people here no doubt, but I’ll stick with good financial forum for money questions, or call a CPA. On the flip side, reading construction / DIY posts on a financial forum can be entertaining sometimes, many are well to do and just hire everything… Guys here know how to do projects.

Michael Best wrote:

MN does have reciprocity with Texas and Texas is a no income tax state.
In 2019 and 2020 I worked down there and had MN taxes taken out.

Figures. You shouldnt have had to pay taxes for that but here we are. I guess you arent a resident of Texas but the work you did was there.