Does anyone live in a state outside of their home office? Is it a risky move?

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A lot of people in the NY metro area do. Not a big deal.

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Yep 👍. The biggest risk I have is buying too large of a house with the difference in cost of living.

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Many major cities are near state borders. It’s fine so long as you do the taxes correctly. DC, Philadelphia, NYC all exist in multi-state metro areas; Boston and Chicago, for example, are a bit farther from state borders but have employees resident in Indiana, Michigan, Rhode Island, New Hampshire, and Wisconsin in addition to Massachusetts or Illinois.

Where it is going to be a problem is that if you want to be physically located somewhere like NYC but list a home address in Texas purely to save on taxes and do so in an undisclosed manner. It can also be a problem for travel expenses - your employer is responsible for getting you from your assigned metro area to the client or meeting event site and back - not somewhere else, and if you go somewhere else then it becomes taxable “alt travel”.

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Yes. For instance, I live in suburban Philadelphia in Pennsylvania and when I work from home, my taxes are lower as Philadelphia’s wage taxes are higher when I am physically in the city. My employer typically withholds taxes on the assumption that I am in the office each day, and when my timesheet shows there are days that I am not (working from home, at a client somewhere else with lower taxes, etc), I get that difference back a few pay cycles later as an adjustment. If I was somewhere with higher taxes, that difference is made up by the employer so as to not create an economic disincentive to work in the higher cost location.

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I’m doing this now

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Same

Not a risky move as long as you still pay residency taxes in your home office state and the firm/your employer knows that you are aligned to office X, but living in city Y.

You mean income tax right? How would you pay residency if you don’t have a place there? And do you then pay dual taxes for the state you actually live in?

I know someone who lives in PA but commutes to MD. Seems rough to me, but he seems very happy

Well, MD and PA share a border for 200 miles or so. I guess it matters how deep into PA he lives and where in MD he works.

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