Question

John owns a home in Denver, where he has a seasonal job. From January through June, he lived and worked in Denver, earning $40,000. He rented a utility apartment while he was working in Sioux Falls, although he often flew back to Denver to spend weekends with his family. Which state is most likely John's tax home?

John can choose his tax home since he spends six months of the year in both places.

John has no tax home. he is considered an itinerant worker since his jobs are seasonal, and he spends six months on the year in both places

Colorado

South Dakota

Answer 1

Luis will have to pay taxes in Denve,Colorado

• Sioux Falls,State of South Dakota is among the states which does not imposes personal income tax. Further there need to be drivers licence and Vehicle registered to become a resident. Hence no taxes for luis in South Dakota
• He is not an itinerant worker as he own a home in Denver

Luis has a home in Denver Colorado as he owns a property there, his family resides there and he spends more than six months in (6 months for the job plus the time that he comes to visit his family) and the Colorado laws consider such person as residents. The relevant portion of the law is quited below for reference: -

"When evaluating whether a person’s state of domicile is Colorado,

The Department of Revenue will consider, among other factors, Colorado voter registration, Colorado vehicle registration, Colorado driver’s license, school registration, property ownership, and residence of spouse and children. A person is a “statutory” resident of Colorado if the person maintains a permanent place of abode in Colorado and spends, in aggregate, more than six months of the tax year in Colorado"