How to adjust NC income allocation from the W-2 amount

Forum|Forum|1 year ago
February 15, 2025
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My W-2 allocated income to each of two different states (NC, my state of residency, and ID, where I worked about 40% of my work hours). The allocation was based on an estimate at the first of the year, and the actual allocation should be different.

If I select NC part-time residency for myself and not my wife, then I get a screen showing the W-2, not grayed out. But I cannot adjust the amount of income attributable to each of the two states. When I go into the NC forms I cannot adjust the W-2 income allocation there either. Surely there must be a way to adjust those values – how do I do that?

Using TurboTax Premier on MacOS.

Best answer by KeshaH

You mentioned that NC is your state of residence. If you were a resident of NC for the full year, all of your income is taxable to NC - regardless of where it was earned. You would only allocate income between the two states if you were a part year resident of both.

However, NC will typically allow you a credit for the tax that you paid on the income that is taxable to both states.

KeshaHAnswer

However, NC will typically allow you a credit for the tax that you paid on the income that is taxable to both states.

dcc67Author

Thank you, KeshaH. That is helpful and explains the numbers coming from TurboTax when I select full-time NC resident.

However, if I select part-time resident of NC for myself (my wife stayed in NC all the time; for me, I can see my residency being argued either way), I still get a dialog box that shows the W2 allocations of income to the two states, and that box does not allow me to edit those values to the correct values (even though they are not in gray highlight). This has been a consistent TurboTax behavior for 3 years now, so I must be missing something.

KeshaH

We can take a look at your return so we can see exactly what you see and help come to a resolution. The return will be scrubbed and will not include any of your personal details.

Once you're logged in to your account,

- on the left hand panel, click on Tax Tools and then choose Tools

- on the pop up window, select Share my file with Agent

- you'll see a message saying you'll give us a copy of your tax return. Your personal information will be changed so we can't see any private information.

- click okay and you'll get another message with a token

Reply to this message with your token and we'll take a look to see what we can find. Let us know what other states, if any, are included in your return.