The Foreign Service Journal, January-February 2015

60 JANUARY FEBRUARY 2015 | THE FOREIGN SERVICE JOURNAL file tax returns in that state if appropriate—so that when you leave the D.C. area for another overseas assignment, you can demonstrate to the District of Columbia, Virginia or Maryland your aliation to your home state. Also, if possible, avoid using the D.C. or Dulles, Va. pouch zip code as your return address on your federal return, since in some cases the D.C. and Virginia tax authorities have sought back taxes from those who have used this address. See the box on p. 58 for new procedures within the State Department for state tax withholdings. States That Have No Income Tax There are currently seven states with no state income tax: Alaska, Florida, Nevada, South Dakota, Texas,Washing- ton andWyoming. In addition, NewHampshire and Tennes- see have no tax on earned income, but do tax profits from the sale of bonds and property. States That Do Not Tax Non-Resident Domici l iar ies There are 10 states that, under certain conditions, do not tax income earned while the taxpayer is outside the state: California, Connecticut, Idaho, Minnesota, Missouri, New Jersey, NewYork, Oregon, Pennsylvania (see entry for Pennsylvania below) andWest Virginia. The requirements for all except California, Idaho, 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, P.O. Box 327005, Montgomery AL 36132-7005. Phone: (334) 242-1512. Email: 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 Oce 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. Email: 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 physical pres- ence 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 Minnesota and Oregon are that the individual 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 employees should also keep in mind that states could challenge the status of overseas government housing in the future. “State Overviews” and “State Pension and Annuity Tax” sections below give brief state information on tax liabil- ity, with addresses provided to get further information or tax forms. Tax rates are provided where possible. As always, members are advised to dou- ble-check with their state’s tax authorities.While AFSAmakes every attempt to provide the most up-to-date information, readers with specific ques- tions should consult a tax expert in the state in question at the addresses given.We provide the website address for each in the state-by-state guide, and an email address or link where available. Some states do not oer email customer service.We also rec- ommend the Federation of Tax Administrators’ website, www. taxadmin.org, which provides much useful information on individual state income taxes. 2014 AFSA TAX GUIDE