Question

State Taxes for Wages earned in one state while living in another state

Forum|Forum|5 years ago
March 31, 2021
1 reply
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I moved to Michigan from Ohio on 4/30/2020 but worked the entire year for an employer in Ohio resulting in W-2 wages. Also, I had 1099-R earnings from a pension for the entire year. Do I report both types of wages on the reciprocity wages page even though it asks for W-2 wages?

KathrynG3

No. Report just the wages in this section.

In general, income is reported in the state of residence where it is received.

Sometimes, there is a difference in reporting between earned income and unearned income. Wages are earned. The pension income is considered unearned, even though you received it from working previously.

It is best to start by filing the part-year state return where you started 2020. Always end with the state of residence on December 31.

Therefore, complete the Ohio state tax return before completing the Michigan state tax return.

For more information, see: How do I allocate (split) income for a part-year state return?

For 2021, provide the Ohio employer with Form IT-4NR so that Michigan taxes are withheld going forward. Until this is done, both an Ohio return and a Michigan return would be filed in order to claim a refund for the Ohio tax.

R

rkaschAuthor

Thanks for the clarification of earned versus unearned income. However, the Ohio state tax page now says line 12 (Ohio State income) for Schedule A must be blank. Originally, it asked for the amount of wages earned in Ohio while a resident of Michigan. Suggestions?

D

DianeW777

When you enter your wages from your W-2 in the federal program be sure you add a state to include both states. Enter the wages earned for each state for the period you lived that that state. Enter the withholding exactly as it appears because this is where your employer paid the state tax that was withheld.

This should being the page again about what wages were earned in OH while a MI resident.

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