Live in MA, but work in RI? MA could owe you some Big Bucks!
For all those who live in Massachusetts, but work in Rhode Island, you have the pleasure of filing and paying taxes in both states. While MA would give you a credit for taxes paid to RI, it’s a royal pain in the neck for most to comply with this dual filing mandate.
To add insult to injury, RI also assessed RISDI (not Rhode Island School of Design, but Rhode Island State Disability Insurance) for every Rhode Island employee. Per prior MA regulations, this tax was not considered income tax. Accordingly no credit was allowed on your MA return for any of this tax paid. Currently this tax can total up to $720.
Good news! A recent new Directive from the Massachusetts Department of Revenue changes this position so this tax will now be allowed as a credit on MA. Also, not only do you get this for 2011 and going forward, but you can apply the change retroactively to all open tax years. That means you can go back to 2008 (at least until April 17th 2012), as well as 2009 to 2011.
You have to apply for the refund by filing a form CA-6 with all the necessary attachments. But do it sooner than later due to the impending 2008 deadline. We filed a claim for one of our clients and they stand to get close to $3k back. How sweet is that!?
For more helpful tips and advice give the professionals at TaxSense a call! Our team of CPAs and tax professionals are happy to answer any questions you may have.
-Jim Henderson, CPA
Kevin Henderson | 08/09/2010