- State Income Tax Residence Rules
- Do You Have to Pay Income Tax to a Nonresidential State?
- Which States Don't Have State Income Taxes?
- If My Job Did Not Take Out Federal Income Taxes, Does That Mean I Pay?
- Can I File as Single and Head of Household if I'm Still Married but Estranged?
- Can I File Head of Household if I Am Married but Have a Dependent and Pay Over Half of the Expenses?
As in most other states, residents of Utah must file annual income tax returns and pay taxes on the money they earn. If you live in Utah but work somewhere else, you may still have to pay tax on that income. It all depends on your status as a Utah resident.
Filing Status and Residency
The rule for filing tax returns and paying state income tax in Utah depends on your residency. If you have a permanent Utah residence, but left for Texas to work for less than half the year, the money you earned in Texas is taxable in Utah. State law defines a "nonresident" as someone who had a domicile in Utah for less than 183 days during the year. If you had an abode in Texas for 183 days or more, you don't need to pay Utah taxes on money you earned in Texas.
Federal Tax Return
Like many other states, Utah bases its state income tax on income declared to the federal government on Internal Revenue Service Form 1040, the federal tax return. If you do not meet the minimum income threshold for filing a federal tax return, you don't need to file a Utah return, no matter how much you earned in or out of Utah.
If you are a nonresident of Utah, but earned money in Utah and also must file a federal tax return, you have to file a Utah state return as well. This means income you earned while working in the state, or income from a Utah source while working outside the state (and living, for example, in Texas). This provision in the law often trips up self-employed and freelance workers, who may find out, several years later, that the money they earned from a Utah company means they have to pay Utah taxes.
When preparing your Utah return, and dealing with out-of-state income, keep in mind that you may claim a credit for any income taxes you pay to another state. Without this rule, which is a common feature of all state income tax laws, workers would be subject to double taxation on income they earn outside their own state. With Texas earnings, however, it's not going to be an issue: Texas has no state income tax.
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