Live in Delaware, Work Remotely for a Arizona Employer: Who Taxes You?
Answer
Delaware taxes the income and Arizona cannot. Residency, not the location of the job, drives this answer: Delaware reaches all of a resident's income, and Arizona has no personal income tax to apply to the part earned inside its borders.
Last verified
The instinct that working in a no-tax state means paying no tax is the single most expensive misunderstanding in this niche. Arizona takes nothing, but Delaware still taxes residents on income earned anywhere, so the full amount lands on your Delaware return.
What you file
- 1Resident return · Delaware
File a Delaware resident return reporting all of your income.
The two states, side by side
| Delaware | Arizona | |
|---|---|---|
| Taxes wages | Yes — graduated | Yes — graduated |
| Reciprocity partners | None | None |
| Convenience rule | Yes — general rule | No |
| Nonresident return | Form PIT-NON | Form 140NR |
| Credit for other-state tax | Schedule I (Form PIT-RES) | Form 309 |
| Nonresident safe harbour | None published | None published |
| Local income tax | Yes | No |
| Revenue department | Delaware Division of Revenue | Arizona Department of Revenue |
| Last verified |
The other direction
Reversing the commute does not always reverse the answer. Living in Arizona and working in Delaware gives:Convenience-of-the-employer rule — both states tax you.
Same two states, different situation
The withholding answer turns on how you are paid and where the work happens, not only on which two states are involved.
- W-2 commuter: Delaware → ArizonaBoth states — credit offsets the double tax
- 1099 contractor: Delaware → ArizonaHome state, plus the client state if you work there
- Moved mid-year: Delaware → ArizonaTwo part-year returns
Other Delaware pairs
Questions people actually ask
I live in Delaware and work remotely for a Arizona employer. Which state do I pay?
Delaware taxes the income and Arizona cannot. Residency, not the location of the job, drives this answer: Delaware reaches all of a resident's income, and Arizona has no personal income tax to apply to the part earned inside its borders.
Which state should my employer be withholding for?
Delaware. Your employer should withhold Delaware tax rather than Arizona tax on these wages. If a Arizona line is showing on your pay stub, raise it with payroll now rather than at filing time.
Does my Arizona employer's location alone create a Arizona tax obligation?
No. Arizona sources wages to the place where the work is physically performed, and it does not apply a convenience-of-the-employer rule that would override that. Days you actually spend working inside Arizona are a different matter — those are Arizona-source income and can require a nonresident return.
How current is this?
The Delaware and Arizona rules on this page were last checked against Delaware Division of Revenue and Arizona Department of Revenue on 2026-08-07. We re-check the full grid every December after state legislative sessions close, and re-check the convenience-of-the-employer states quarterly because that is where the rules move fastest.
Sources
Every fact above comes from the revenue department that publishes the rule. We do not cite secondary summaries, and we do not restate a figure we could not find at source.
- Delaware Division of Revenue — individual income taxaccessed 2026-08-07
- Arizona Department of Revenue — individual income taxaccessed 2026-08-07