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My Wife's company had her incorrectly paying CA tax for a paycheck before it was fixed, how to file?

Forum|Forum|3 years ago
March 16, 2023
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Hi TurboTax community.

We caught this early on and corrected it, but my Wife's W-2 has a paycheck's worth of income attributed to CA. This was an error, and was adjusted to our current state properly, but the W-2 still has CA state wages written on box 16 of the W-2. We never lived in CA for any of last year.

How should this be filed? I assume that means there was some tax paid to CA before fixed that I will need a refund for. If there is still "Reported W-2 Wages" listed, do I need a corrected W-2?

Also, I was under the impression that it was just withholding that needed to be fixed so I went ahead and filed my Fed and Current state taxes last night through TurboTax with the intent to do the simpler CA return to correct it separately. Now I am wondering if I need to get a corrected W-2 and have to redo my tax return?

Thank you for the help!

Not A Product Question

Best answer by Vanessa A

All you will need to do is file a CA nonresident return and when you get to the income adjustment section, remove all income so that CA income was $0. Then the amount that was withheld, will be an overpayment and refunded to you. This amount should be reported separate from the correct state. This is assuming, she did not ever physically work in the state since you stated you had it corrected. If she did work in the state, she would have to pay taxes on the income she earned while physically in the state.

There is no need to really redo your taxes as it should not affect your federal or your home state return. You do not need a corrected form, you just need to make the adjustments as I stated above.

All income earned would be reported and taxable to your home state.

V

Vanessa AAnswer

All you will need to do is file a CA nonresident return and when you get to the income adjustment section, remove all income so that CA income was $0. Then the amount that was withheld, will be an overpayment and refunded to you. This amount should be reported separate from the correct state. This is assuming, she did not ever physically work in the state since you stated you had it corrected. If she did work in the state, she would have to pay taxes on the income she earned while physically in the state.

There is no need to really redo your taxes as it should not affect your federal or your home state return. You do not need a corrected form, you just need to make the adjustments as I stated above.

All income earned would be reported and taxable to your home state.

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