Quick Answer
Only 16 states plus D.C. have reciprocal tax agreements that prevent double taxation for cross-border workers. Pennsylvania has the most agreements (6 states), while states like California, New York, and Texas have none. These agreements save workers from filing multiple state returns and paying duplicate taxes.
Best Answer
Sarah Chen, Payroll Tax Analyst
Best for remote employees working across state lines or those with employers in different states
Which states have reciprocal tax agreements?
Reciprocal agreements exist between only 16 states plus Washington D.C., covering about 32% of all states. These agreements prevent you from being taxed by both your work state and home state on the same income.
States with reciprocal agreements:
How reciprocal agreements work in practice
Let's say you live in Pennsylvania and work remotely for a company in New Jersey. Without a reciprocal agreement, you'd potentially owe:
With Pennsylvania-New Jersey's reciprocal agreement:
Example: $85,000 remote worker
Consider Maria, who lives in Maryland and works remotely for a Virginia company earning $85,000:
With reciprocal agreement (current situation):
Without reciprocal agreement:
States WITHOUT reciprocal agreements
Major states with NO reciprocal agreements include:
What to do if your states don't have an agreement
Step 1: Your work state will withhold taxes as if you're a resident
Step 2: File a non-resident return in your work state
Step 3: File a resident return in your home state
Step 4: Claim a credit for taxes paid to the other state (usually on your home state return)
Step 5: One state typically gives you a full credit, preventing double taxation
Key factors affecting reciprocal agreements
What you should do
Use our paycheck calculator to see how reciprocal agreements (or lack thereof) affect your take-home pay. Input your home state, work state, and salary to see the tax implications.
Key takeaway: Only 16 states have reciprocal agreements, so most cross-border workers will need to file multiple state returns and claim credits to avoid double taxation.
*Sources: [State tax reciprocal agreements](https://www.taxadmin.org/state-tax-forms), [IRS Publication 505](https://www.irs.gov/pub/irs-pdf/p505.pdf)*
Key Takeaway: Only 16 states have reciprocal tax agreements, with Pennsylvania having the most (6 agreements), so most multi-state workers must file returns in both states.
States with the most reciprocal tax agreements
| State | Number of Agreements | Partner States |
|---|---|---|
| Pennsylvania | 6 | IN, KY, MD, NJ, OH, WV |
| Virginia | 5 | DC, KY, MD, PA, WV |
| Maryland | 4 | DC, PA, VA, WV |
| Indiana | 3 | KY, OH, PA |
| Kentucky | 3 | IL, IN, OH, PA, VA, WV |
| Ohio | 3 | IN, KY, PA, WV |
More Perspectives
Sarah Chen, Payroll Tax Analyst
For those who moved to a new state mid-year or are planning a move
How reciprocal agreements affect new residents
When you move states mid-year, reciprocal agreements can simplify your transition, but they don't eliminate the need for part-year resident returns.
Example scenario: You lived in Ohio through June, then moved to Pennsylvania in July while keeping the same remote job.
With Ohio-Pennsylvania reciprocal agreement:
Timeline considerations for movers
Before the move:
After the move (within 30 days):
Special situations for recent movers
If you move to a state with NO reciprocal agreement, you might face:
Pro tip for movers: Many states have different tax rates, so moving from a high-tax state like New York (8.82% top rate) to a low-tax state like Pennsylvania (3.07% flat rate) can significantly increase your take-home pay, even without reciprocal agreements.
Key takeaway: Recent movers still need part-year resident returns even with reciprocal agreements, but these agreements prevent double taxation on the same income periods.
Key Takeaway: Recent movers still need part-year resident returns even with reciprocal agreements, but these agreements prevent double taxation on the same income periods.
Sarah Chen, Payroll Tax Analyst
For those working multiple jobs across different states
Managing multiple jobs across state lines
Reciprocal agreements can get complicated when you have jobs in multiple states, especially if some state combinations have agreements and others don't.
Complex scenario example:
John lives in Maryland and has:
How reciprocal agreements apply:
Without reciprocal agreements (worst case)
If John lived in a state like New York with no reciprocal agreements:
Withholding strategy for multiple jobs
With multiple employers across states:
1. Prioritize reciprocal agreements: File appropriate forms with each employer
2. Monitor total withholding: Multiple jobs can lead to under-withholding
3. Make estimated payments: If withholding is insufficient across all jobs
4. Track everything: Keep detailed records of income by state and employer
Key takeaway: Multiple jobs across states become much more manageable when reciprocal agreements exist, potentially reducing filing from 4+ returns to just 1-2.
Key Takeaway: Multiple jobs across states become much more manageable when reciprocal agreements exist, potentially reducing filing from 4+ returns to just 1-2.
Sources
- State Tax Reciprocal Agreements — Federation of Tax Administrators reciprocal agreement database
- IRS Publication 505 — Tax Withholding and Estimated Tax
Reviewed by Sarah Chen, Payroll Tax Analyst on February 28, 2026
This content is for educational purposes only and is not a substitute for professional tax advice. Consult a qualified tax professional for advice specific to your situation.