Question

Alabama State Tax return - state reduced my refund

Forum|Forum|6 years ago
July 24, 2019
1 reply
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I moved from Alabama to Tennessee in June 2018. I retired from my employer in Alabama on July 12, 2018. When I completed my taxes, I entered my dates of residence in Alabama and Tennessee. I was paid accumulated sick time and remaining vacation time after I moved to Tennessee. Per completion of my return in Turbotax, my income was allocated to each state. $99606 was earned in Alabama and $46979 was earned when I was a resident of Tennessee and no longer working in Alabama. My refund due on my return was $3322. Alabama Department of Revenue send me a letter reducing my refund to $975 stating that the my full income of $146585 was taxable in Alabama. I don't believe that is correct.

Other

Rainman12

Employee

Sounds like the discrepancy is in how you answered interview questions. 1) Earned income is taxable to where earned, regardless of where or when paid. 2) Sick leave and vacation time count as earned income. 3) Retirement income, by contrast, is taxable to where you are when you get it. Pending further info, AL is correct. If all your income was derived from work you did in AL, and/or reported on a W-2, then it's all taxable to AL, regardless of where you were when paid.