Filing Residents, Nonresidents, and Part-Year Residents - FAQ

  • What are the filing requirements for a nonresident who works in Georgia and/or has other Georgia source income?

    Nonresidents, who work in Georgia or receive income from Georgia sources and are required to file a Federal income tax return, are required to file a Georgia income tax return. Some examples of Georgia source income are wages, Georgia lottery winnings, income from flow through entities (s-corporations, partnerships, LLC’s, trusts, and estates), rents, etc. If you are a legal resident of another state, you are not required to file a Georgia income tax return if your only activity for financial gain or profit in Georgia consists of performing services in Georgia for an employer as an employee when the compensation for services performed does not exceed the lesser of 5% of the income received in all places during the taxable year or $5,000.00.

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  • How do we file a tax return when one spouse is a resident of Georgia and the other is not?

    If one spouse is a resident of Georgia and one is not, the taxpayer should write three in the residency code block (nonresident) of the Form 500. You must use Schedule 3 of Form 500 to calculate your Georgia taxable income.

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  • What are the tax law rules for changing filing status from married filing separate to married filing joint and married filing joint to married filing separate?

    If taxpayers filed separate returns, they may change to a joint return for that year any time within three years from the due date of the separate return or returns. If they filed a joint return, they cannot choose to file separate returns for that year after the due date of the return.

    Exception: A personal representative for a decedent may change from a joint return elected by the surviving spouse to a separate return for the decedent. The personal representative has one year from the due date of the return to make the change.

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  • Does Georgia recognize common law marriages?

    Prior to 1997, Georgia recognized common law marriages. Georgia no longer recognizes common law marriages that occurred after 1996.

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  • Normally Georgia will accept the automatic federal extension to file (form 4868) if it is attached to the Georgia return. What procedure should be used if the federal extension was obtained over the telephone or electronically?

    The instructions to the 4868 indicate that before you call or file electronically you should fill in Form 4868 as a worksheet. If you did not fill in this 4868 worksheet as they requested, fill one in now with the appropriate information. Attach this 4868 worksheet to your Georgia return. Also, write "filed extension by telephone" or "filed extension electronically" and the IRS confirmation number on the top of the 4868 worksheet. If you eventually file your return electronically, it is not necessary to send us a copy of the 4868 worksheet. The 4868 worksheet should be retained with your copy of the return.

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  • Is severance pay received by a nonresident taxable for Georgia purposes?

    Severance pay received by a nonresident is not taxable for Georgia purposes. Nontaxable severance pay is defined as pay that is received for which no services are rendered in Georgia. Any portion of the income included in the W-2 that is received for past or future services rendered in Georgia, including accrued vacation, sick pay, and holidays, will still be taxable for Georgia purposes as is outlined in the next question. For example, a taxpayer is terminated by a Georgia employer but the employer agrees to pay them $500.00 per week severance pay for two weeks. No services are required to be rendered to receive this pay. The first week the taxpayer receives a check for $1100.00, which includes $500.00 of severance pay and $600.00 of accrued vacation pay. The $600.00 accrued vacation pay is taxable for Georgia purposes but the $500.00 severance pay is not taxable. The next week the taxpayer receives a check for $500.00 for severance pay. This is not taxable for Georgia purposes.

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  • Are vacation, holiday, and sick pay for a nonresident who works in Georgia taxable for Georgia purposes?

    If a nonresident works in Georgia, he/she is taxed on all income that is received from an employer, including vacation, holiday, and sick pay, based on regulation 560-7-8-.01(b)(1), unless he/she falls under the 5% exception of Georgia code section 48-7-1(11)(A). Georgia regulation 560-7-8-.01(b)(1) is clear that for a nonresident the actual number of days worked in Georgia divided by the total days worked everywhere is the ratio that should be applied to determine Georgia source income. If the nonresident only works in Georgia, the ratio would be 100% and all income that is included in the W-2 that is received for past or future services rendered in Georgia, including vacation, holiday, and sick pay, would be taxable for Georgia purposes.

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  • If I am receiving a pension from another state and I move to Georgia, is the pension taxable for Georgia purposes?

    Yes.

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  • If I am receiving a pension from Georgia and I move to another state, is the pension taxable for Georgia purposes?

    No.

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  • How should the income tax paid to a tax jurisdiction other than the state of Georgia (other state income taxes), which is not allowed for GA purposes, be computed if my state & local income taxes were limited on my federal return to $10,000 ($5,000 MFS)?

    The following formula should be computed to determine the disallowed other state income taxes:

    Other state income taxes divided by the total taxes on line 5d of schedule A multiplied by the lesser of the amount on line 5d of schedule A or 10,000 ($5,000 if married filing separately).

    For the schedule 3 computation, the same computation should be used in arriving at the amount of itemized deductions that would then be subject to proration using the part-year/nonresident income ratio on form 500 schedule 3 line 9.

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