How do I fill in the portion of the income items earned in another state? Do I put the local wages I earned while working in that state?

In the case of W-2 income, state A or state B income is reported in boxes 15-20 and flow to the proper state income tax return.  This is generally the way local taxes are reported.

Other incomes are likely reported as you answer questions within the tax software.

All states are different, but the general rules are:

• That you are a resident of state A and state A has a claim on your income.
• If you are a non-resident of state B, you may need to file a non-resident tax return to state B if you fall under the state B filing requirement.
• You may also file a non-resident return to state B to receive a refund of state B tax withheld.
•  If you pay state B income taxes, state A may give you credit for taxes paid to the other state.

Reciprocal state agreements allow you to live in state A, work in state B and withhold and pay taxes only to state A.