Re:Elon Musk moves to Texas
by ghaff on Wednesday December 09, 2020 @02:08PM
(#25362885)
In this case, one also assumes that Musk will continue to spend a fair bit of time in the state. Low-profile people can usually get off with just paying taxes in their home state even though they spend a lot of their time at company offices, conferences, etc. elsewhere. But presumably there is some threshold beyond which you're supposed to be filing taxes in other locales.
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New York city has its own income tax rate of 3.9% for high earners. This can be quite a bit of money for hedge fund managers/owners. I've read that some of them live outside NYC to avoid the tax but need to hire a full time person to document and make sure they are not counted as a NYC resident by the city. You can only spend so many nights in NYC and not be counted as a resident, show proof of you being somewhere else, etc.
Income taxes has so many bad consequences. It would be great to ban it and replace it with land value taxes.
The letter of the law in a lot of places can be even worse than that. [1] There's been federal legislation proposed but AFAIK, nothing has been passed. A lot of states theoretically require you to file a tax return even if you only travel there for a day. Of course, I'd be shocked if pretty much anyone complied with that for sometimes travel. But it means lots of people are basically committing tax fraud; many/most probably don't even know they are.
[1] https://www.pewtrusts.org/en/research-and-analysis/blogs/sta...
I did on internship in Texas when living in California. I had to pay California state income tax on what I earned there. Luckily Texas has no state income tax or I would have been paying in both states.