Solved

Live in IL but work for NY Company. Unsure about "Allocate your Illinois and non-Illinois amount", Was taxed in both IL and NY for the same income. What should non-IL be

Forum|Forum|6 years ago
June 5, 2019
2 replies
0 views

I lived in IL and NJ for part of the year, but worked for a NY company the whole time. The entire income was taxed in NY, and the portion while living in IL was also taxed by IL. On the "Allocate your Illinois and non-Illinois amount" It has the wages filled in for IL but nothing in 'Non IL income'. Should I be filling some amount in there? I am trying to determine if I qualify for a "tax paid in other state" credit

TurboTax Deluxe Online

Best answer by DanielV01

It depends. The question is asking how much of the income that is being reported to Illinois was actually earned in another state, in this case NY, so that the credit for taxes to another state may be calculated correctly. For this question, if the amount reported to NY is taxable to NY, this is the information you will put in this box.

However, there are other factors. NY has some tricky laws when it comes to income that is taxable to NY. Although you did not live there, you are considered as working in NY if you worked remotely from home. In this circumstance, (which seems to be the case here) you file a NY nonresident return on all of your income, and both Illinois and NJ will give you credit for the NY income that you earned while in each state, since each taxes the amount of income you earned in NY during the same time period.

If, however, NY was not supposed to tax this income, you still file the NY nonresident return, but you will allocate the income in New York. Your Illinois income would not be taxable in NY if you were working in an Illinois office instead of from home, and you would want to indicate that this income is not taxable.

Either way, you do wish to prepare the nonresident return first to get accurate calculations. Here's an FAQ to assist you with this: https://ttlc.intuit.com/replies/3302052

[edited 3/5 2017 6:03 PST]

DanielV01Answer

Employee

It depends. The question is asking how much of the income that is being reported to Illinois was actually earned in another state, in this case NY, so that the credit for taxes to another state may be calculated correctly. For this question, if the amount reported to NY is taxable to NY, this is the information you will put in this box.

However, there are other factors. NY has some tricky laws when it comes to income that is taxable to NY. Although you did not live there, you are considered as working in NY if you worked remotely from home. In this circumstance, (which seems to be the case here) you file a NY nonresident return on all of your income, and both Illinois and NJ will give you credit for the NY income that you earned while in each state, since each taxes the amount of income you earned in NY during the same time period.

If, however, NY was not supposed to tax this income, you still file the NY nonresident return, but you will allocate the income in New York. Your Illinois income would not be taxable in NY if you were working in an Illinois office instead of from home, and you would want to indicate that this income is not taxable.

Either way, you do wish to prepare the nonresident return first to get accurate calculations. Here's an FAQ to assist you with this: https://ttlc.intuit.com/replies/3302052

[edited 3/5 2017 6:03 PST]

**Say "Thanks" by clicking the thumb icon in a post**Mark the post that answers your question by clicking on "Mark as Best Answer"

N

nperri6Author

Thanks, that makes sense. What I am wondering about is that, when I don't allocate for IL I am not receiving any tax credit for the taxes that I paid in NY. When I do my NJ taxes I do. I am wondering why the IL taxes don't offset.

K

Kamilcygan

Not true. I just went through this. IL Department of Revenue is going to send you mail audit asking for your employer to provide days worked in each state. No employer will do that and therefore IL will not allow credit. Publication 302 exceptions. Also, there is a case that went through the IL court system in 2015 that allows for that double taxation scheme, so basically save yourself 10% in penalties and pay tax in both states…

M

minivatreni

I am working for a NYC based company, and they allowed me to work remotely, so I moved to Chicago in April 2023. I've been living in Chicago ever since.

I know that NY is one of the few states that taxes remote workers. Does IL give you a credit for taxes paid via NY's convenience rule, or will I just have to pay taxes in both states?