My husband is in the Army. Our home of record is Michigan and we are stationed at Fort Rucker, Alabama. I know that he does not have to pay state taxes but we still file with Michigan and always have a $0 pay/credit. My question is that I am working now as an independant contractor and will be getting a 1099 from the company I contract with, which is in New York. Its an online tutoring company. Which state do I file my state taxes to... michigan our home of record or Alabama where we live???

Thank you!!
Kristina

I will throw one cog in your wheel. New York has some rules that you need to check out. If you did online work for a New York company using facilities that where based in New York, you may owe income tax to the state of New York. And they have a very high income tax rate. Here is a quote form an editorial in the New York Times:

"Telecommuting disincentives should be abolished. New York, for example, taxes nonresidents who work for in-state employers, not just on the income they earn when they work in the state but also on income earned when working from home. Because states where the telecommuters live can also tax the income earned at home, many telecommuters are double taxed."

I woukld do a seach on "telecommute new york" to read up on this.

Hm, thats INTERESTING! Grr, now I have another issue to look into!!

Thanks for the heads up!
Kristina