State taxes

West Virginia and Kentucky have an agreement with each other (reciprocal agreement) that states that residents of one state won't pay income tax to the other state on wages & salaries. So since you live in West Virginia, you shouldn't have taxes withheld for Kentucky on your W-2 income.

However, since you did have withholding for Kentucky, you'll need to file a nonresident return to recoup the money that was sent to the state.

Enter the W-2 information as shown on your copy of the W-2, including the income and withholding for both states.

When you get to the state section, you'll need to add Kentucky as a state return if it's not already there. Make sure it shows as a nonresident return and complete this one first.

As you go through the screens, you will get to a page that says "Nonresident/Prt-Year Resident Income Allocation", Click Continue. On the wages and salaries screen, the Kentucky portion of income should be zero. If it's not, you will need to update it. On the remaining screens, allocate income as appropriate. If none of your other income is taxable to Kentucky, leave those fields blank.

Following these steps will remove your W-2 income from the Kentucky return. If you only had this kind of income in Kentucky, you should see a refund of all of the tax that you paid through your job. If you had any other kind of income in Kentucky, it wouldn't be covered by the reciprocal agreement. Therefore, it'd be subject to KY tax.