Do Expats Pay State Taxes? State Tax Guide for Americans Living Abroad

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Do expats pay state taxes? What about federal? Learn everything you should know about expat state taxes and federal taxes and more with H&R Block.

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Unlike almost everywhere else in the world, qualifying American expats still have a U.S. tax obligation to the Internal Revenue Service while living overseas — and, depending on your home state before moving abroad, that also may include state taxes.

U.S. state taxation for expats can be confusing for even the most seasoned expats, and the penalties for non-compliance are steep. Below, we’ll walk you through the basics of United States taxes and state residency for expats below and help you get started on your own state tax return.

Ready to file for this tax year? You’ve got two options: Jump in the driver’s seat with our DIY online expat tax service designed specifically for U.S. citizens living abroad or let one of our experienced Tax Advisors take the wheel.

Yes, U.S. citizens may still have to pay federal AND state taxes even if they live abroad.

The fact is, if you are a U.S. citizen or Green Card holder who makes above the general United States filing threshold you are still required to file federal U.S. taxes and report your worldwide income every year regardless where in the world you live. It’s much the same for state taxes, depending on the state.

Expat tax rules say taxable foreign income for U.S. citizens living abroad includes:

Before you stress about paying taxes twice on the same taxable income (once to the U.S. and once to your new country) you should know there are tools and benefits available to expats. These benefits and tax credits, such as the Foreign Earned Income Exclusion and Foreign Tax Credit, can help you avoid double taxation.

Want a quick summary of taxes for expats? We distilled what you should know into 20 things you should know about taxes for expats.

Who must pay state taxes as an expat?

“Do I have to pay state taxes while living abroad?”

Great question.

Whether or not you need to file state taxes while living abroad depends on the state you last lived (or were considered a resident of), if you’re still considered a resident of that state, and if you make income in that state.

State residency while living abroad

State residency while living abroad is a tricky topic. Each state has different definitions of who qualifies as a resident and some states (like Florida) don’t even have state income tax requirements. On the other end of the spectrum are states (like New York and California) that require you pay expat state taxes on foreign income.

Some factors that can affect whether you’re considered a state resident for tax purposes include:

  • Where your car is registered
  • If you have a driver’s license or state ID
  • Where you are registered to vote
  • If you own any property or have mortgage/lease payments on any property in the state
  • If you pay any utility bills in the state
  • Where your family lives
  • The permanence of your overseas assignment
  • Your financial assets and accounts within the state

Even if you don’t qualify as a resident, some states require expats pay taxes if they have any income from that state. Not sure what applies in your situation? Instead of diving into each state’s specifics here, below you’ll find links to each state’s revenue department (and state residency qualifications), so you can jump right to your state in question.

If you’re still unsure about your residency or your state’s qualifications, it’s best to leave your tax filings to an expert.

StateDepartment NameResource Link (Click to open in new tab/window)
AlaskaDepartment of RevenueTax Division Website
AlabamaDepartment of RevenueDepartment of Revenue
ArkansasDepartment of Finance and AdministrationDepartment of Revenue Website
ArizonaDepartment of RevenueDepartment of Revenue Website
CaliforniaDepartment of Tax & Fee AdministrationDepartment of Tax & Fee Website
CaliforniaEmployment Development DepartmentEmployment Development Department Website [Withholding Taxes]
CaliforniaFranchise Tax BoardFranchise Tax Board Website [Income Taxes]
ColoradoDepartment of RevenueDepartment of Revenue
ConnecticutDepartment of Revenue ServicesDepartment of Revenue Services
District of ColumbiaOffice of Tax and RevenueOffice of the Chief Financial Officer
DelawareDivision of RevenueDivision of Revenue
FloridaDepartment of RevenueDepartment of Revenue
GeorgiaDepartment of RevenueDepartment of Revenue
HawaiiDepartment of TaxationDepartment of Taxation
IowaDepartment of RevenueDepartment of Revenue
IdahoState Tax CommissionState Tax Commission
IllinoisDepartment of RevenueDepartment of Revenue
IndianaDepartment of RevenueDepartment of Revenue
KansasDepartment of RevenueDepartment of Revenue
KentuckyDepartment of RevenueDepartment of Revenue
LouisianaDepartment of RevenueDepartment of Revenue
MassachusettsDepartment of RevenueDepartment of Revenue
MarylandComptroller of MarylandComptroller of Maryland
MaineRevenue ServicesRevenue Services
MichiganDepartment of TreasuryDepartment of Treasury
MinnesotaDepartment of RevenueDepartment of Revenue
MissouriDepartment of RevenueDepartment of Revenue
MississippiDepartment of RevenueDepartment of Revenue
MontanaDepartment of RevenueDepartment of Revenue
North CarolinaDepartment of RevenueDepartment of Revenue
North DakotaDepartment of RevenueOffice of State Tax Commissioner
NebraskaDepartment of RevenueDepartment of Revenue
New HampshireDepartment of RevenueDepartment of Revenue Administration
New JerseyDepartment of RevenueDivision of Taxation
New MexicoDepartment of RevenueTaxation and Revenue Department
NevadaDepartment of TaxationDepartment of Taxation
New York CityTaxation and Revenue DepartmentDepartment of Finance
New YorkState Department of TaxationState Department of Taxation and Finance
OhioOffice of State Tax CommissionerDepartment of Taxation
OklahomaTax CommissionTax Commission
OregonDepartment of TaxationDepartment of Revenue
PennsylvaniaDepartment of RevenueDepartment of Revenue
Philadelphia, PADepartment of RevenueDepartment of Revenue
Puerto RicoDepartment of RevenueDepartment of Revenue [Departamento de Hacienda]
Rhode IslandDepartment of RevenueDivision of Taxation
South CarolinaDepartment of RevenueDepartment of Revenue
South DakotaDepartment of Revenue and RegulationDepartment of Revenue
TennesseeDepartment of RevenueDepartment of Revenue
TexasComptroller of Public AccountsComptroller of Public Accounts
UtahState Tax CommissionState Tax Commission
VirginiaDepartment of TaxationDepartment of Taxation
VermontDepartment of TaxesDepartment of Taxes
WashingtonDepartment of RevenueDepartment of Revenue
WisconsinDepartment of RevenueDepartment of Revenue
West VirginiaDepartment of RevenueDepartment of Revenue
WyomingDepartment of RevenueDepartment of Revenue
U.S. expat filing state taxes online while living abroad

What’s the best state for expat taxes?

This question is right up there with “what’s the best place to live abroad?” The answer is the same — it depends. The best state residency for expats depends on your life situation, your needs, and what’s most important to you.

States with no income tax for expats

Some states have no income tax. Those states are:

  • Alaska
  • Florida
  • Nevada
  • South Dakota
  • Texas
  • Washington
  • Wyoming

States that only tax U.S. expats on interest and dividends

  • Tennessee
  • New Hampshire

States with other considerations

While all states have rules on residency status and who qualifies, some states have more specific considerations:

  • California
  • New Mexico
  • South Carolina
  • Virginia
  • New York

Some expats refer to these states as “sticky” states because of the specific considerations. If you’re an expat and also considered a resident of one of these states we highly recommend getting started with an Expat Tax Advisor.

Do expats need to pay state taxes for past years?

If you’re reading this article and just realized you should have been filing and paying U.S. federal and state taxes for expats, don’t panic — we’ve helped thousands of U.S. citizens in this situation. There are special rules, called Streamlined Foreign Offshore Procedures, that let expats catch up on back taxes.

To qualify, you must:

  • Have lived in a foreign country without a U.S. abode for at least 330 days during one of the last three years
  • Confirm it was an honest mistake that you failed to file U.S. tax returns and FBAR Get started with streamlined filing now.

How to file state expat taxes online with H&R Block Expat Tax Services

Ready to file state taxes as an expat? Here’s how to file your U.S. expat taxes online:

  1. Head on over to our Ways to File page
  2. Pick your journey — in the driver’s seat with our online DIY tool or letting a Tax Advisor take the wheel.
  3. Once you’re through your chosen journey, you review your return and pay
  4. We file your return with the IRS
  5. You sit back knowing your taxes were done right

Now that you know expats may need to pay state taxes while living abroad, it’s also important to understand that they can be more complicated than filing from within the States. Whichever method you choose to file, you can rest assured that your expat state taxes will be filed accurately, backed by H&R Block’s 100% Accuracy Guarantee.

Get started on your expat taxes now!

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