State income taxes incorrectly withheld

Forum|Forum|2 years ago
February 8, 2024
1 reply
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Hello!

I currently work and live in Kentucky and did so all of 2023. Prior to that, I lived in Ohio and worked in KY. Last year, I emailed our payroll department to make the change to the state taxes withheld from my paycheck. When I received my W2, I realized only Ohio state income taxes were withheld and none for Kentucky. How does this impact how I file? I don't want to hire someone to fix this problem when it was clearly not my fault. Any help is appreciated!

Not A Product Question

MayaD

Employers are not required to withhold Ohio income tax for an employee who lives and works in another state, even if the work is performed for an Ohio company.

You need to file non-resident Ohio return to receive a refund.

How do I file a nonresident state return?

You might have to pay underpayment penalty . However, KY Department of Revenue may consider waiver of all or a portion of imposed penalties and/or cost of collection fee if you can demonstrate reasonable cause. It your responsibility to supply the Department of Revenue with documentation to support the claim.

KY Department of revenue

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sarabeth82Author

I don't work or live in Ohio anymore and didn't last year either. They mistakenly took out Ohio state income tax instead of Kentukcy which is why I'm confuses as to how to file.

SharonD007

Although your employer withheld Ohio state taxes instead of Kentucky, you will get a refund from Ohio of the taxes that were mistakenly taken out. You will have to file a nonresident Ohio tax return to get the refund. First, file your nonresident tax return, then you resident Kentucky tax return.

You will need to contact your payroll department again to correct your withholding but may have to file two state tax returns again next year if your employer is still withholding Ohio state taxes.

For additional information, review the TurboTax help articles: Do I need to file a nonresident return for an out-of-state employer?

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