I have a rotational job which requires me to frequently move to different states. a different state every 4 months. Additionally, my driver's license and parents live in Oregon, so I consider Oregon as my state of residence, but I didn't spend any time working there.

So in summary, I live in Oregon and this year will have have worked in New York, Connecticut, and Virginia.

Currently, I have a decent amount of profit from day trading and option selling. Last year, I only traded stocks and I traded at a loss. During tax time, I used TurboTax and Scottrade's import feature to automatically deal with all my trading taxes. When I did this, Turbotax imported all my trades into all the states I lived in. So it seems, all states tax credited (?) my trading loss.

This year I am primarily using Interactive Brokers, which does not allow auto import into Turbotax. So I am wondering how exactly my day and option trading activity will be taxed on the state level? Will all of the states I am involved in tax my trading activity? That doesn't sound right as I will pretty much lose all my trading profits to taxes. Shouldn't trades be taxed only in the closing state (e.g. if I buy back a profitable short option while I'm in VA, I should be taxed only VA)?

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    The same way other income is taxed -- you may need need to fill out forms in all four states and pro-rate appropriately, and may need to consider exact dates. This is a case where I would seriously consider getting professional advice. – keshlam Jul 25 '16 at 12:17

I think your tax will be based on what state you are living in at the time you cash in your investments and receive the capital gain for them. It's the only way this makes sense.

This would be similar to the concept of a day trader who is flying from one end of the country to the other, trading all the way in-flight. By the theory of what you're saying, he'd have to pay taxes for every state he flew over as he made trades, and that would make no sense.

No investment can be taxable until the amount actually gained can be quantified. As long as your money was in play, gains were only theoretical, not real.

If, however, you took the proceeds of your trades out as income at any point, then you owe taxes in the state where you lived at the time you received the income.

I hope this helps.

Good luck!


Complex question and different states have different rules. State residency is often based upon intent. If you go to New York, but knew up front this wasn't permanent, then you would be a non-resident as you intent was to return to Oregon.

Some question to understanding your tax home. Where do you get your mail? Where are you registered to vote? Where are you bank accounts located? Where is your church? Doctor? Lawyer? Accountant? Vehicle registration? If you pull a credit report on you what address does it show? One of of the biggest elements of intent is ownership or rental of housing.

If you move to NY and earn wages there (meaning the source of the delivery of your effort was NY), you will have to file a non-resident resident return and declare the income earned on those wages. However, if you traded stocks while in NYC, you would declare any gains in your tax home state.

What you can't be, however, is stateless. Unless you leave the country, you are always a resident of some state (long or short term).

If you do not have sufficient evidence that Oregon is your intended tax home (not having a permanent home in your name is a big negative), then yes you will have to break out state income tax based upon the financial transaction that occurred your period as a resident (no matter how short).

Many states extract extra taxes for non-resident filers. Some states also will imposed extra taxes if are a resident and declare income/taxes paid to another state (generally your home state will provide a credit), however if the foreign state taxes are lower some home states will impose a penalty.


state of residency determines what state tax you'll pay.

What state you own a home in, what state your car is registered in, what state do you vote in, and probably most importantly, what state is on your Federal income tax return.

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