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01-29-2018 09:33 PM
We moved from Illinois to Tennessee in July. I am self-employed as a photographer. My agi on my federal was around 5,600. How do I figure the amount to report to IL as my agi? The federal return automatically does my deductions, but the state one is asking me how much of this portion was for IL. My actual gross earnings for the period of time I was in IL is more than the 5,600. Help!
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02-06-2018 03:53 PM
First, you should determine how much of your income you earned in each state. The easiest way to do this might be to check your bank records to see how much you took in payments while living in each state.
For example, assume you made $10,000 from your photography business. Assume further that you moved from Illinois to Tennessee on July 15, 2017. You could check your bank statements to see how much in total payments you received before July 15. If you received $8,000 from photography clients before that date, 80% of your income would be deemed to be from Illinois. 20% would be from Tennessee.
Once, you know your percentage of income from each state, you can apply that percentage to your federal AGI. Illinois starts its AGI calculation by taking the federal AGI and then making up and down adjustments. Continuing with our example, if your federal AGI were $5,000, then your Illinois AGI would be 80% of that, or $3,000. You should be able to use these steps to find your IL AGI.
If you have any other questions, we will be happy to assist.
Tax Research Specialist (San Diego, CA)