What happens to my taxes if I move to a new state mid-year?

Moving to a new state mid-year means you will likely need to file part-year resident returns in both your old and new states — in addition to your federal Form 1040. **How it works:** Most states require you to file a part-year resident return for the period you lived there. You generally report and pay state income tax on income earned while a resident of that state. **Example:** You live in California (13.3% top rate) through June 30, then move to Texas (no income tax) on July 1. You file a California part-year return for Jan–Jun income, and a federal return for the full year. Texas has no income tax, so no state filing is required there. **Self-employed individuals with a year of income in both states:** - Allocate Schedule C income by the period earned in each state - Keep records showing which invoices/payments were received in which month - Many states use a time-based allocation (days in state / total days) **Domicile vs. residence:** States may dispute whether you truly changed your domicile (permanent home), particularly high-tax states like California and New York. To establish a new domicile: update driver's licence, voter registration, bank accounts, and spend more than 183 days in the new state. **California non-resident sourcing:** California taxes income from California sources (e.g. work performed for a CA client while you were physically in California) even after you leave the state.

• File part-year resident returns in both the state you left and the state you moved to
• Allocate self-employment income by period earned in each state
• Domicile change must be documented — update licence, voter registration, 183+ days rule
• California and New York are particularly aggressive in challenging domicile changes
• Keep detailed records of when income was earned relative to your move date