I used to live in El Paso but worked in New Mexico, just across the border. I had to file/pay NM state taxes. In Texas, there is no state income tax. They just charge a higher sales tax, which is ultimately regressive (more punitive to lower income groups). So the situation was the worst of both worlds. I think, though, that I was able to write off the tax I paid NM on the following year's federal return. Wheee, 15 cents on the dollar!
Anyway the guiding principle, I assumed, was that if an employer is paying you in state X, then state X expects you to pay their income tax if such exists.
