Moved to a new state mid-year
A mid-year move from a tax state to a no-tax state. The federal return is unaffected by where you live; the lesson is how income is allocated between states, worked all the way through a Georgia part-year return.
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Taxpayer facts
Who this is and what their year looked like.
Marcus is single. He lived in Atlanta, Georgia through June, then moved to Jacksonville, Florida in July for a new job and stayed the rest of the year.
He had a job in each state. Prepare his federal return and his Georgia part-year resident return (Form 500 with Schedule 3). Florida has no income tax, so there is no Florida return.
Source documents
The 2 documents you will prepare the return from: W-2 (Wage and Tax Statement (Georgia job)), W-2 (Wage and Tax Statement (Florida job)).
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Objectives
What a correct return should capture.
- Build the federal return: total the wages from both W-2s for AGI, subtract the 2025 single standard deduction ($15,750), and figure taxable income and the income tax.
- Key idea: the federal return does NOT change because of the move. You report ALL income for the year no matter which state you lived in.
- Total the federal withholding (box 2 of both W-2s) and compare it to the tax for the federal refund or balance due.
- The state side: after a move, you file a PART-YEAR resident return in each state you lived in, allocating income by residency period (and by source).
- Here Georgia taxes the income Marcus earned while a Georgia resident (the Georgia job), and the Georgia withholding is claimed on the Georgia return, not the federal.
- Florida has no income tax, so there is no Florida return: the wages earned after the move aren't taxed by any state.
- Watch for double taxation in the general case: if BOTH states taxed the same dollars, you'd claim a credit for tax paid to the other state. It doesn't arise here because Florida has no tax.
- Georgia Schedule 3: put federal income in Column A, the income earned while a Georgia resident in Column C, and the rest in Column B.
- Divide Column C by Column A for the Schedule 3 ratio, and use it to prorate the Georgia standard deduction for a single filer.
- Figure Georgia taxable income and the tax at the 2025 flat rate (Form 500, line 16).
- Credit the Georgia withholding (line 24) to find the refund or balance due, and the voucher if one is needed.
Check your work
The answer key and the complete return, the way a real client receives it: the 1040 and its schedules, the workpapers behind every number, and the signature forms.
Stuck? Work through it with Yehuda
A one-on-one, 30-minute tutoring session on this return with Yehuda Tenenbaum, EA. Bring the spot where you got stuck and we will work through it together: how the forms connect, why a figure lands where it does, and how to check your work. $250. This is education on the practice return, not advice on your own taxes.