I accepted this as the solution and then got to thinking that the unemployment compensation itself wasn't really earned in the domiciled state of Kentucky where the T/P lived for 7 months while receiving it. The basis for receiving it arose in Colorado where the T/P lived for 4 months. The T/P's driver's license was also issued in Colorado. Viewed as such, in regard to your information, this could really go either way. One question which could possibly help decide: Is unemployment actually considered as 'earned'? If yes, then I would be inclined to choose Kentucky, the state of domicile (most months where lived), to be the state where it should be taxed. I just read today that both KY and CO are 2 of 13 states that will tax the federally exempted U.C. If there is a choice in the matter, I would obviously choose the state with the lowest tax rate. (Colorado is 4.55% for 2020 and Kentucky is 5% flat tax)