Question

State income tax from state I've never been to

Forum|Forum|4 years ago
February 23, 2022
1 reply
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My previous employer withheld Arizona State income taxes (~$900) from my pay last year, despite me working remotely entirely from Washington State (which has no state income taxes).

I'm using TurboTax and the Arizona state refund they are calculating with my "non-resident" form is $247. Am I correct in thinking that because I didn't work in Arizona (let alone: I've never been there) that I should owe absolutely 0 in state taxes, and so the refund should be $900? TurboTax doesn't seem to account for the situation where you don't live NOR didn't work in a state. They only seem to recognize the possibility that you traveled and worked within another state when it comes to "non-residency". There is no option for me to say "I've made $0 income in Arizona", so it seems to be treating me as though I did physically work within that state no matter what I do.

- I tried contacting TurboTax using Premium services.. and they didn't know. Referred me to Arizona Revenue Services. ARS referred me to the IRS. The IRS phone number has no options even remotely similar for the issue.

- I tried contacting my employer to tell them this makes no sense, both while working for them and post-employment. They don't care and/or understand (non-English multi-national mega-company) and won't change anything.

Any help is much appreciated.

Not A Product Question

T

ThomasM125

You are correct that you should not owe taxes to Arizona.

You will have to file an Arizona tax return to get a refund of the taxes withheld. The problem with that is Arizona will go by what is reported on your W-2 form. So, if the W-2 says you had Arizona wage income, there is little you can do to convince Arizona otherwise, short of getting a corrected W-2 form. The state tax return does not provide for an entry to make wage income reported on your W-2 not taxable if the W-2 form says it is.

This is not a TurboTax issue, it is the way the state tax return is designed. Your only option is to get the W-2 corrected or prepare the state return by leaving the state wages off of the W-2 entry or some similar work-around, to show no taxable income in Arizona and attach an explanation as to why it is not taxable. But as I said, the state will probably just tell you to get the W-2 corrected and deny your refund.

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