The Foreign Service Journal, January-February 2014

68 JANUARY-FEBRUARY 2014 | THE FOREIGN SERVICE JOURNAL AFSA NEWS 2013 AFSA TAX GUIDE personal income but do tax profits from the sale of bonds and property. There are 10 states that, under certain conditions, do not tax income earned while the taxpayer is outside the state: California, Con- necticut, Idaho, Minnesota, Missouri, New Jersey, New York, Oregon, Pennsylvania (see entry for Pennsylvania below) and West Virginia. The requirements for all except California, Idaho, Minnesota and Oregon are that the indi- vidual not have a permanent “place of abode” in the state, have a permanent “place of abode” outside the state, and not be physically present for more than 30 days during the tax year. California allows up to 45 days in the state during a tax year. All these 10 states require the filing of non-resident returns for all income earned from in-state sources. Foreign Service employ- ees should also keep in mind that states could challenge the status of government housing in the future. The following list gives a state-by-state state overview of the latest information available on tax liability, with addresses provided to get further information or tax forms. Tax rates are provided where possible. For further information, please contact AFSA’s Labor Management Office or the individual state tax authorities. As always, members are advised to double-check with their state’s tax authorities. To assist you in connect- ing with your state tax office, we provide the website address for each in the state-by-state guide, and an e-mail address or link where available. Some states do not offer e-mail customer service. The Federation of Tax Administrators’ website, www.taxadmin.org , also provides much useful infor- mation on individual state income taxes. STATE OVERVIEWS ALABAMA Individuals domiciled in Alabama are considered residents and are subject to tax on their entire income regardless of their physical presence in the state. Alabama’s individual income tax rates range from 2 percent on taxable income over $500 for single taxpayers and $1,000 for married filing jointly, to 5 percent over $3,000 for single taxpayers and $6,000 for married filing jointly. Write: Alabama Department of Revenue, 50 N. Ripley, Montgomery AL 36132. Phone: (334) 242-1099. E-mail: Link through the website, “About Us” then “Contacts,” then “Income Tax” Website: www.ador.state.al.us ALASKA Alaska does not tax individual income or intangible or per- sonal property. It has no state sales and use, franchise or fiduciary tax. Some municipalities levy sales, property and use taxes. Write: State Office Building, 333 West Willoughby Ave., 11th Floor, P.O. Box 110420, Juneau AK 99811-0420. Phone: (907) 465-2320. Website: www.tax.state.ak.us ARIZONA Individuals domiciled in Arizona are considered residents and are taxed on any income that is included in the Federal Adjusted Gross Income, regardless of their physical presence in the state. Arizona’s tax rate ranges in five brackets from a minimum of 2.59 percent to a maximum of 4.54 percent of taxable income over $300,000 for married filing jointly or $150,000 for single filers. Write: Arizona Department of Revenue, Taxpayer Information & Assistance, P.O. Box 29086, Phoenix AZ 85038-9086. Phone: (602) 255-3381. E-mail: For general questions: taxpayerassistance@azdor.gov Website: www.azdor.gov ARKANSAS Individuals domiciled in Arkansas are considered residents and are taxed on their entire income regardless of their physi- cal presence in the state. The Arkansas tax rate ranges in six brackets from a minimum of 2.5 percent to a maximum of 7 percent of net taxable income over $34,000. Write: Department of Finance and Administration, Income Tax Section, P.O. Box 3628, Little Rock AR 72203-3628. Phone: (501) 682-1100. E-mail: Individual.Income@dfa.arkansas.gov Website: www.arkansas.gov/dfa CALIFORNIA Foreign Service employees domiciled in California must establish non-residency to avoid liability for California taxes (see FTB Publication 1031). However, a “safe harbor” provi- sion allows anyone who is domiciled in state but is out of the state on an employment-related contract for at least 546 consecutive days to be considered a non-resident. This applies to most FS employees and their spouses, but mem- bers domiciled in California are advised to study FTB Publica- tion 1031 for exceptions and exemptions. The California tax