College students, living out of state questions


M

Melissa

We have 2 son's attending college in Kentucky. They live
there, and work there. Our home state is Ohio.

We were able to claim them on our Federal Return for 2003
because of they were full-time students.

So, since they work in Kentucky, who do we file their State
returns with? They made about $6,000 and $9,000 each on
their part-time jobs.

In Ohio, even if someone else can claim you on the Federal
Forms, you can file and claim yourself as well on the State
Return. I don't know if all the States are the same in that
regard.

Advice or suggestions on where to get help is appreciated.

Melissa
 
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K

Kerry Nichols

Melissa said:
We have 2 son's attending college in Kentucky. They live
there, and work there. Our home state is Ohio.

We were able to claim them on our Federal Return for 2003
because of they were full-time students.

So, since they work in Kentucky, who do we file their State
returns with? They made about $6,000 and $9,000 each on
their part-time jobs.

In Ohio, even if someone else can claim you on the Federal
Forms, you can file and claim yourself as well on the State
Return. I don't know if all the States are the same in that
regard.

Advice or suggestions on where to get help is appreciated.
I don't know if Kentucky will allow your sons to claim an
exemption for themselves, but since they earned income in
Kentucky, they must file a Kentucky return.
 
F

Frank S. Duke, Jr.

We have 2 son's attending college in Kentucky. They live
there, and work there. Our home state is Ohio.
Their home state is also Ohio unless they have taken steps
to become KY residents (drivers licenses, voting, paying KY
income tax, etc.). College students are considered to be
temporarily away from home and retain their original
residence.
We were able to claim them on our Federal Return for 2003
because of they were full-time students.

So, since they work in Kentucky, who do we file their State
returns with? They made about $6,000 and $9,000 each on
their part-time jobs.
OH and KY are reciprocal states so KY employers should
withhold Ohio tax. If they withheld KY tax, they will have
to file KY non-resident returns to get the money back and
file OH returns to pay the OH tax. They may be delinquent
in Ohio because they had no withholding.

All freely provided advice guarantee correct or double your
money back

Frank S. Duke, Jr. CPA
Cincinnati, OH USA
 
K

Katie Jaques

Melissa said:
We have 2 son's attending college in Kentucky. They live
there, and work there. Our home state is Ohio.

We were able to claim them on our Federal Return for 2003
because of they were full-time students.

So, since they work in Kentucky, who do we file their State
returns with? They made about $6,000 and $9,000 each on
their part-time jobs.

In Ohio, even if someone else can claim you on the Federal
Forms, you can file and claim yourself as well on the State
Return. I don't know if all the States are the same in that
regard.

Advice or suggestions on where to get help is appreciated.
I would suggest you get professional help with your sons'
state taxes this year. There are several complex issues and
it is impossible to answer your questions without access to
all of the facts.

Ohio defines a resident for tax purposes to include all
persons domiciled in the state. If your sons are in
Kentucky only for the purpose of attending college, and do
not intend to establish permanent homes there, then they are
probably still Ohio residents for tax purposes.

Kentucky defines a resident to include persons domiciled in
the state, and also any person who spends more than 183 days
of the taxable year and maintains a place of abode in the
state. It may make a difference whether your sons maintain
living accommodations in Kentucky when school is not in
session, e.g. during the summer. It is entirely possible
for your sons to be tax residents of both Ohio and Kentucky
at the same time.

There is a reciprocal agreement between Ohio and Kentucky,
so that an Ohio resident working in Kentucky pays tax only
to Ohio on his earnings. If your sons are Ohio residents,
and not Kentucky residents, they are not subject to Kentucky
tax on their wages earned there. On the other hand, if they
are Kentucky residents under the Kentucky law, then they are
not eligible for the exclusion.

There may also be an issue with respect to the credit for
taxes paid to another state. If your sons are Ohio
residents, but they are also considered tax residents by
Kentucky, it is likely that Kentucky will tax their earnings
but Ohio will not allow credit for the Kentucky tax paid
(because of the reciprocal agreement).

You need a knowledgeable practitioner who is familiar with
both Ohio and Kentucky tax laws to sort this out.

Katie in San Diego

The foregoing is intended for educational purposes only and
does not constitute legal or professional advice.
 
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D

Douglas T. Lee

Melissa said:
We have 2 son's attending college in Kentucky. They live
there, and work there. Our home state is Ohio.

We were able to claim them on our Federal Return for 2003
because of they were full-time students.

So, since they work in Kentucky, who do we file their State
returns with? They made about $6,000 and $9,000 each on
their part-time jobs.

In Ohio, even if someone else can claim you on the Federal
Forms, you can file and claim yourself as well on the State
Return. I don't know if all the States are the same in that
regard.

Advice or suggestions on where to get help is appreciated.
Based on what you describe, in the worst case, they may have
to file a Kentucky non-resident form and an Ohio form
claiming a credit for taxes paid to Kentucky. Check your
Ohio instructions and you can access the Kentucky
instructions for the 740-NP at:

http://revenue.state.ky.us/individual-2003.htm

Kentucky and Ohio have reciprocal agreements where under
certain circumstances Ohio residents are not required to
file Kentucky non-resident returns. You will need to
determine if they qualify for this based on the rules in the
Kentucky instructions. If no return is required there, they
may still need to file a form to request a refund of taxes
from Kentucky. If a tax return is required for Kentucky,
the credit for taxes paid to the nonresident state
(Kentucky) is claimed in Schedule C of the Ohio IT-1040.

Realize that if your two sons have abandoned their Ohio
residence and do not have any plans to return to Ohio and
have taken up permanent residence in Kentucky, you may have
a very different tax situation.

If all of this becomes too complicated, you may want to seek
the services of a qualified tax preparer who can carefully
review your situation and determine the scenario that
applies to your situation.
 

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