Question

Moved to NY from IL in October. Help with 2019 return (multiple state withholdings)

Forum|Forum|6 years ago
May 4, 2020
1 reply
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I started a new job in May 2019 for a company with its HQ in New York City. For the first 6-7 months, I worked in their Chicago office. I moved to NYC at the end of October, and worked in their NYC office for about 1.5 months. But on my W2 in Box 16 (which states the wages earned in each state), 100% of my earnings are attributed to NY. When the two wage amounts in Box 16 for IL & NY are added together, it totals more than my federal wage amount. Apparently New York State requires companies to report the person's whole year income or full annual wages, whether you worked for one day in NY or 365 days.

How do I file my taxes? When I insert the information into TurboTax as stated on the W2, NY is claiming I owe them thousands, even though the majority of my earnings were in IL. Where in the software can I outline what %s of these wages were made in NY vs. IL? Should I deduct the IL amount from the total and insert that figure for NY?

J

JotikaT2

It depends.

I'm not sure who informed you that you needed to pay tax on the income you earned all year in New York. This is incorrect. You may need to go back to your employer and request that they issue a corrected W-2.

The total amount of your state wages should not exceed the amount reported in Box 1 for federal wages.

Please see the excerpt below. You should only be taxed in New York for your income earned while you were a part-year resident and for the portion earned from New York sources while you were a non-resident.

New York sourced income

The tax form will start its calculation using the total income from the federal return. However, it will allocate only the percentage of income earned from New York sources as compared to the total income when you are taxed.

As far as reporting your income, once you have confirmed your state amounts with your employer, you can input your information into TurboTax as follows.

In the My Info section of TurboTax, confirm that you have entered the correct state information:

Click "Edit" to the right of your name
Confirm your input under #2 "Tell us the state(s) you lived in"
Confirm the rest of the state-specific questions here as well including the "previous state of residence" and "date you became a resident" of the state noted
Do the same for your spouse if you are married filing jointly.
Go back to the personal information section, and verify the mailing address and "Other state income" section.

Review your input on your W-2 Wages under the "Income & Expenses" section.

Confirm that you have entered the correct state for each W-2 in Boxes 14-15.

This will then allow you to enter your state returns for the part-year resident states.

Prepare the part-year resident state tax return for the state you no longer reside in first. Be sure to answer the questions carefully as you only want to report the income earned in while residing in that state.

Once you have entered all of the first part-year resident information, then start your part-year resident state tax return for the state you reside in as of December 31st, 2019.  This will ensure you receive any credits for taxes on income which may have been taxed in both states.

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