If you`re considering moving between Connecticut (CT) and Massachusetts (MA) or working in one state while living in the other, you may be wondering if the two states have a reciprocal agreement. Unfortunately, the answer is no.
A reciprocal agreement is an agreement between two states that allows residents of one state to pay income taxes to their home state rather than the state they work in. This agreement can be beneficial to workers who live in one state but work in another, as they only have to file taxes in their home state. Additionally, it can simplify the tax filing process and prevent double taxation.
However, CT and MA do not have a reciprocal agreement. This means that if you live in CT but work in MA, you will be subject to Massachusetts income tax, and vice versa. You will need to file tax returns in both states and pay taxes to both states based on the income you earned there. This can make tax season more complicated and potentially more expensive.
It`s important to note that even though the two states do not have a reciprocal agreement, they do have agreements in place for determining which state has taxing jurisdiction over income earned by non-residents. These agreements are known as tax treaties and they prevent double taxation on income earned by non-residents who work in both states.
In summary, if you plan to move between CT and MA or work in one state while living in the other, you will need to be prepared to file tax returns in both states and pay taxes based on the income you earned in each state. While it may be more complicated and potentially more expensive than if the two states had a reciprocal agreement, tax treaties can help prevent double taxation for non-residents. As always, it`s important to consult with a tax professional for personalized advice on your specific situation.