Avoiding MA income tax

[frisco]

I work for an agency based in MA as a W2 employee, and they are currently withholding MA income tax.  However, I live in NH, the client site is in NH, and I have never worked a day outside of this state since I started with them.

Do I have to go 1099 in order to avoid paying the state of MA, or is there a way for me to get that money back when I file?

[cathleeninnh]

It is sticky. It is easiest to do with the cooperation of your company's HR department. They can very easily change your state of record to NH and not withhold. Whether they will or not is something else. You have a good case. The company does require you to work out of state. That is key to the law in MA.

The tax form itself does not provide a good way for W2 employees to claim a refund.

You might want a tax professional.

[Russell Kanning]

If you can go 1099, then that would leave some power in your own hands.
You could also tell the current hr people that you are exempt from income tax or have loads of deductions.
Once the mafia gets the money it is hard to get it back.

[frisco]

Thanks gang!  I guess I'll be applying for a business license as a sole proprietor again.

[Russell Kanning]

I don't know if you need a business license for what you are discussing.

[error]

What's a business license?

[Nat F]

I work for an agency based in MA as a W2 employee, and they are currently withholding MA income tax.  However, I live in NH, the client site is in NH, and I have never worked a day outside of this state since I started with them.

Do I have to go 1099 in order to avoid paying the state of MA, or is there a way for me to get that money back when I file?

I have apportioned my wages myself as a W2 employee, and made sure to keep very accurate records of the time spent in NH vrs MA.  Your employer should be willing to apportion your wages correctly (100% in NH) but even if they are not you are able to do it yourself.  Just keep good records.

http://forum.soulawakenings.com/index.php?topic=5807.msg103987#msg103987

-Nat

[cathleeninnh]

http://www.dor.state.ma.us/forms/inctax06/inctax06.htm

"NONRESIDENT APPORTIONMENT WORKSHEET: You cannot apportion Mass. wages as shown on Form W-2."

[Nat F]

http://www.dor.state.ma.us/forms/inctax06/inctax06.htm

"NONRESIDENT APPORTIONMENT WORKSHEET: You cannot apportion Mass. wages as shown on Form W-2."

"Any nonresident can submit an alternative basis of apportionment and explain that basis on the return.  However, the basis would be subject to review and modification by DOR."

http://www.dor.state.ma.us/help/guides/abate_amend/personal/issues/Nonresidents.htm#Apportionment

The "However" is very important, that's why I mentioned your employer should be willing to do it.

-Nat

[cathleeninnh]

The DOR (and we all know how reliable that can be) told me a letter from your employer is sufficient, but without their cooperation, you are SOL.

Cathleen