Laura reviews tips for living in multiple states and ways to prepare your finances to do it successfully as a remote worker, sunbird, or snowbird.
Laura reviews tips for living in multiple states and ways to prepare your finances to do it successfully as a remote worker, sunbird, or snowbird.
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Every year, millions of Americans move from one state to another. They might permanently relocate to be closer to family or for a new job. Some may split their time between two or more places as remote workers or retirees. We call northerners who move to a warmer, southern location in the winter "snowbirds." I see plenty of them where I live in Florida.
However, living and working in more than one state can get complicated because you may need to file taxes in more than one state. I also received a great question about being a snowbird from Rhonda S., who says:
"I'm 45 and have lived in a snowy winter location my whole life, but I would like to be a snowbird by 55, with a job supporting that lifestyle. I own a home that will be paid off by then, and I have no other debt. I have an emergency fund and contribute 12% of my pay to my retirement account. I don't have kids and am not married. What tips do you have for becoming a snowbird?"
Thanks for your question, Rhonda! I'm the opposite, having lived in hot, southern states most of my life. I plan to be a sunbird and head north during the sweltering Florida summers. This post will review five tips for living in multiple states and ways to prepare your finances to do it successfully.
Welcome back! I appreciate you joining me for Money Girl episode 892! I'm Laura Adams, an award-winning author, on-camera spokesperson, female money speaker, founder of The Money Stack, a Substack newsletter, and host of Money Girl with over 43 million downloads.
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5 things to know about living and working in multiple locations
If you're a remote worker or retiree living or working in more than one state or outside the country, here's what you need to know.
1. You might need to file multiple state tax returns.
Before you decide to live or work in another state, it's essential to know that in addition to paying federal income taxes, you may also owe additional state taxes on your income, no matter where you earn it.
If you earn money in a state different from where you live, you typically need to file tax returns in both states. However, filing multiple state income tax returns doesn't mean you're getting taxed twice. Your home state gives you credit for taxes you must pay to another state.
State laws vary considerably in their tax rates and forms you must file. Some states charge a flat tax, and others have tax brackets that charge progressively higher rates. For instance, California charges one of the highest potential marginal income tax rates at 13.3% on amounts that residents earn over $1 million.
Some states tax corporations, partnerships, certain trusts, and estates. I reviewed the basics of federal and state estate taxes in podcast 891, Does My Inheritance Count as Taxable Income?.
Just like with federal income taxes, if your income isn't subject to withholding by an employer, you must estimate your annual state tax liability and pay it in four quarterly installments. If not, your state can charge penalties and interest.
If you live and work in different states, you must file a tax return in each state that requires it. If you're unsure how to file a state tax return or avoid duplicate taxes, get guidance from a qualified tax professional.
2. Not all states have an income tax.
As of 2025, there are nine states without an individual income tax. They include Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming.
So, if you live or work outside of those states, you must file a tax return in each state annually where you earn income higher than any state threshold. In other words, if you live in California and work for a Florida-based employer, you must pay California income taxes even though Florida has no income tax.
3. Residency rules vary by state.
If you spend part of the year in multiple states, the number of days you're physically there determines whether you're considered a resident, and it varies by state. Most consider you a resident for tax purposes if you live there more than half the year or more than 183 days.
However, no matter where you spend time or own properties, you can only have one domicile, or permanent home, at a time. In other words, you can reside in multiple states, but you must claim one as your domicile. That's critical for various legal issues, including paying taxes, claiming government benefits, and voting.
4. You still owe U.S. taxes when living abroad.
All U.S. citizens must file a federal tax return and pay taxes on their global income, including wages, interest, dividends, and business earnings, even when living temporarily or permanently outside the country.
For 2024, you can exclude up to $126,500 of foreign earnings if you spend at least 330 full days abroad over a 12-month period. Plus, a foreign tax credit (FTC) allows you to claim a credit for any taxes you paid to a foreign government. That helps reduce your taxes and avoid paying twice on the same income.
If you live or retire abroad, the tax laws are complex, so consult a tax professional to comply and minimize what you owe.
5. You may need to file a part-year tax return.
If you permanently relocate to a new state or split time between two states but don't spend 183 or more days there, you may still need to file a part-year tax return. That means you'd only pay taxes on the income earned while you lived in each state.
Some states require you to report all your annual income (as if you were a full-time resident) and then prorate tax based on how much you earned while you were a resident. Other states only require you to report your income while residing there.
So, be sure to keep good records on your residency and income dates so you avoid having to pay double taxes in multiple states.
How to become a snowbird or sunbird?
Rhonda asked for advice on becoming a snowbird so she can escape the cold northern winters for a warmer climate. She didn't mention where she's thinking about going, but choosing a no or low-tax state and making it your domicile can be a good financial move. Consider other issues like a state's inheritance taxes, estate taxes, and probate processes.
Florida is a popular destination for part-time retirees because of the mild weather and its attractive tax benefits, like favorable estate tax laws, low property taxes, and no state income tax. I know many snowbirds who come to Florida on October 1 and leave on May 30, avoiding the hottest months of June through September.
As I mentioned, spending more than 183 days in a state typically allows you to become a resident. Plus, you may need to file a Declaration of Domicile form with your new state, update your mailing address, get a driver's license or state-issued identification card, register a vehicle, and update your auto insurance policy to show that you intend to establish a new domicile.
Rhonda said she would pay off her home before becoming a snowbird. While that's an excellent goal, it's not a requirement to live in multiple states.
Remember that snowbirds can be homeowners or renters. Some rent the same home or condo for four or five months every year, and others purchase a property that stays vacant while they're away. They may even turn it into an income-producing rental property after they head back up north.
Since Rhonda won't be retired for a while, finding work she can do remotely or seasonally may be the key to splitting her time between two states. I'd focus on a nationwide or global job search to find an employer that allows remote work from the states where she's most interested in living.
Another option might be starting a business using her skills and experience that would allow her to earn self-employment income from anywhere. She could start it on the side of her current job and see if building it up could be an option for her future life as a snowbird.
Another consideration for sun and snowbirds is ensuring you update your emergency documents when declaring a new state as your domicile. For instance, make necessary changes to your will, healthcare directives, and estate plans, to simplify legal matters for your heirs.
I recommend spending as much time as possible in potential destinations to see what it's like during the time of year you want to live there. Find out if ample healthcare providers, recreation, and affordable housing exist.
When you find a potential future place to live, you might meet with a local accountant, estate planning attorney, and real estate agent who understands multi-state residency. The sooner you start researching, asking questions, and seeking professional advice, the sooner you'll be ready to fly the coop as a sun or snowbird.
That's all for now. I'll talk to you soon. Until then, here's to living a richer life!
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