State Tax exemption...shananigans.

[ToBeKC135Pilot]

Here is the deal. If you are an Illinois resident, state taxes are not taken out of military pay. However, if you are a Wisconsin resident, they are.

Now my question. I am an Illinois resident taking a tanker job in Wisconsin. Would it be possible to work and live there in Wisconsin, while maintaining my "residency" in Illinois, thus exempting me from state taxes?

Thanks!!

 

[chawbein]

I spent a summer living and working in Texas while maintaining residency in Missouri. No state taxes were taken out in Texas because they have no state tax. When it came tax time in Missouri, I had to pay state taxes on the money I made in Texas. They have tax forms for such an event. In Kansas City it is common for someone to work in Kansas and have Kansas state taxes withheld and live in Missouri where they must pay Missouri state income tax. I believe it works that the state of Missouri allows you to deduct the taxes that were withheld in Kansas against any income made. Since I think the state income taxes in Kansas are lower, you would pay the amount owed to Missouri less the amount paid to Kansas. It's a complicated system and I think that's the jist of it.

 

[ToBeKC135Pilot]

Thanks...I basically follow...but I think my dillemma is a tad different. If I maintain residency in Illinois, but still temporarily "reside" and work in WISCONSIN, will I pay my taxes then to Illinois...in which case the state does not tax military?

thanks

 

[Snoopy58]

The answer probably depends on the specific tax codes in WI. I'd ask a JAG at your base; they're in a far better position than we are to know the laws & give you a good answer.

(Although, if you get your federal tax forms are sent to you at your IL address, you may possibly "fly under the radar" & not be noticed by WI. But I wouldn't count on that as a final answer... talk to a JAG.)

 

[chawbein]

You will still have to pay income taxes to Illinois based on what they tax for military folks. You might want to check, but the taxes are based on where you live, not where you work - somewhat. Look at the case of the NWA pilot who lived in Minnesota and had a mailing address in Florida. He was somehow set up as a legal resident of Florida (no state income tax), but spent most of his time in MN. He was busted and had to pay an assload of money to the state of Minnesota.

 

[AlbieF15]

Ditto for Texas. If you go to any formal AF training courses there, look into become a Texas resident.

In addition to no longer being a d@mn yankee officially, you will also not pay state income taxes. I'm not sure of the length of time you need there to qualify, however.

Other states I know of without state income tax are Washington, Alaska, and Tennessee.

 

[ToBeKC135Pilot]

As stinking Democrat as Illinois is, they still exempt "Military Pay" from income taxes.

I know that if you go active you can keep your home residence. However, I am going Guard and I dont know if you can do that. If so, then cool...if not...and I am guessing not, then dang. I will be in Milwaukee which is close to Illinois (meaning I could live there) but it would be a tad of a commute.

Oh well. Thanks everyone!

Adam

 

[talondriver]

Unless your state has different rules, the only way you can legally be a resident of IL and reside in WI is if you were "active duty military".
You can probably get away with it, but I wouldn't want to get caught by the WI tax people.
I've talked to the JAG about this situation. And, in a round about way, he said you can't do it...legally.