I have been living in USA for many years, and my spouse is an expat who moved to USA in the middle of last year. After her move, we both live and work in different states. She lives and works in Maryland.
We have filed our federal taxes jointly, as resident aliens who meet the substantial presence test. And we are using married-filing-separately for our state returns, since we live in different states.
We would like to file her Maryland state taxes as a part-year resident, so that she will not be taxed on her income prior to her move to USA. However, our tax preparer has stated that "your wife should be treated as a full year MD resident regardless how many days she lived in MD. The reason is because we treated her as a full year resident on Federal. You cannot pick a full year resident in Federal but only accept part year resident in states"
I have already read through the MD filing guidelines and cannot find any such rule. It only recommends filing as a part-year resident if moving into the state midway through the year. I've also not found any such rule at the federal level. I had also hired a 2nd tax preparer to file our returns independently, as a means of cross-checking, and he had recommended filing as a part-year resident.
Is there any truth in what my 1st tax preparer is saying, about "you cannot pick a full year resident in Federal but only accept part year resident in states"?