Married but working and living in 2 different states

***This might be a duplicate response.*** Assuming he is only in CT temporarily and for a particular purpose and therefore would not be considered a resident of CT under their physical presence test and MI is his domicile....

CT requires a nonresident to use the same filing status as on the federal return. If you file a joint federal return, then you will file a joint CT return. If you both file separate federal returns, then he would file a CT married-separate return.

Thanx for the reply. My husband has a permanent full time job in CT. In That case how do we file? He will be living in CT and I will be living in MI.

Assuming that your husband has not changed his domicile (MI remains his one true home, the home he intends to return to when he finishes his employment in CT), then he is a resident of both states for tax purposes. CT provides an option. If you file a joint federal return (and by default must file a joint MI return), he is required to file a married-separate return for CT unless you both elect to be treated a CT residents and file a joint CT return. If he files a CT married-separate return when you both file a joint federal return, he would have to create a pro-forma married separate federal return to use for his CT married separate return. The state of MI will provide a credit for income taxes paid to CT on the income that MI will also want to tax as a MI resident. You both could elect to file a CT joint return if you both filed a federal joint return. This obviously would make all your combined income subject to CT tax. MI would still give you the credit.

Without actually looking at the result of both options, it seems to me that if you both filed a federal and MI joint return and he filed a separate CT return and took the MI credit for taxes paid to CT (the credit can not exceed what MI will tax you on the CT income) double taxation is avoided, you have no tax liability to CT and I think total state taxes are the minimal amount.

When I said "you had no tax liability to CT", that was a singular "you" meaning you as the spouse, not both of you. He obviously has a CT tax liability that gets mitigated in MI by the MI tax credit.