Question

I live in Virginia, but work for CA company. Using TT, I have a significant VA tax due, but a relatively equal CA tax refund. is this correct?

Forum|Forum|4 years ago
February 19, 2022
1 reply
0 views

I had expected that I would have a CA tax (with the withholding I had) and have a VA tax that TT would require me to file for credit, which is what I read in VA tax documentation.

TurboTax Online

R

RaifH

No, this does not sound right. As a resident of Virginia, Virginia has the right to tax all of your income. Since your employer was not collecting Virginia state taxes, you most likely have a large amount owed there, possibly including underpayment penalties.

As far as California is concerned, they consider the source of the income to be the location of the employee when the services are performed. If you did not ever set foot in California, you are not subject to their income tax. You should be getting a full refund of all taxes that were paid to California. Furthermore, you will want to notify your employer to either start withholding Virginia state taxes, or if they are not able to do that, at least file an exemption form for California state taxes and start paying estimated taxes on your own to Virginia.

T

TomD8

Employee

To add to @RaifH's answer:

In order to obtain a refund of the incorrectly withheld CA taxes (assuming you never worked within CA), you must file a non-resident CA tax return, on which you show the CA withholdings but allocate zero income to CA.

**Answers are correct to the best of my ability but do not constitute tax or legal advice.