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Part year resident Illinois and Indiana

T-Town-CPA
Level 4

I have a client who is a dependent of their parents (college student).  The parents moved from Illinois and established residence in Indiana on August 6, 2019.  The student worked over the summer in Tennessee during 2019 and has income earned in Tennessee.  TN has no state income tax and nothing withheld.

For purposes of state income tax, this was all earned by the client before the parents moved.  Therefore, I believe this is income that should be reported as Illinois income on the part year Illinois State Income Tax return.

Please confirm and advise with specific steps I need to take.

Thank you in advance!

Tom

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Just-Lisa-Now-
Level 15
Level 15

Sounds correct to me.


♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪

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4 Comments 4
Just-Lisa-Now-
Level 15
Level 15

Sounds correct to me.


♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪
garman22
Level 13
Level 13

I also agree. Show this as income in Illinois. 

T-Town-CPA
Level 4

Thank you for your quick response!

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BobKamman
Level 15

You are confusing state income tax residency requirements with Internal Revenue Code dependency definitions, maybe with some school rules regarding in-state tuition thrown in.  For Illinois state income tax purposes, he is still a full-year resident, unless you want to claim he is a part-year resident and not include the time he was in Tennessee.  He has no tax nexus with Indiana.  

This reminds me of my college days in Illinois, when I helped roommates fill out their state income tax returns.  I had no training but I must have been good at it because they received  refund checks for the amount shown on the return, and then a month later received another refund check for the same amount.  I remember some connection between this and Paul Powell's shoeboxes, but you have to be of a certain age to remember the Illinois politician whose unexpected death led to the discovery of $800,000 cash squirreled away in various places he had stayed.  

 

 

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