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Level 2

I believe my W2 is wrong - CPA told me to file the correction I think is correct. Is this right?

I was on the phone with a TurboTax CPA specialist and we realized that we believe my wife's W2 is wrong. 

Background: my wife and I moved from MA to CA. My wife continued working for her MA company remote for 1 month while she lived in CA. Her MA company W2 wage Box 1 is 32k, but her Box 16 State Wage for CA is 21k and Box 16 State Wage for MA is 34k. Adding up the two Box 16 State Wages is way over the Box 1 wage!

After looking at her paycheck and corroborating the numbers, we believe the error is her Box 16 State Wage CA is correct at 21k and the Box 16 State Wage MA should be the difference between her overall Box 1 Wage of 32k and the CA State Wage. So Box 16 MA should be 32k minus 21k = 11k.

The CPA told me to file under the assumption that Box 16 MA should be 11k for now, and ask for a corrected W2 from my company since we are so close to deadline. If the corrected W2 is different from what we assume, then we should file an amended tax return then.

Is this the right way to do this? I don't want to get in trouble for assuming the wrong correction!

5 Replies
Level 2

I believe my W2 is wrong - CPA told me to file the correction I think is correct. Is this right?

Is that correct i 2nd paragraph that state wages are $34K for MA, which is higher than Federal wages of $32K?
If this is the case the employer needs to issue a corrected W-2.
Level 2

I believe my W2 is wrong - CPA told me to file the correction I think is correct. Is this right?

Hi TurboTaxMichael - Yep that is correct! My state wages for MA alone are higher than the Federal Wages... sounds like we agree that the W2 is wrong. What's your advice on next course of action for me if the corrected W2 doesn't come on time?

Also, my CA employer W2 has state wages about $1k higher than Federal Wages. Should I be concerned here?
Level 2

I believe my W2 is wrong - CPA told me to file the correction I think is correct. Is this right?

Find out why it is different first, as there are some state such as NJ that do not allow per-taxed medical premiums to reduce the taxable wages.  First I want to make sure the W-2 is correct.--This is starting point.

Generally when you have two part-year state returns you only pay tax on income earned in each state and there is no credit for taxes paid in another state.

Your situation is not in the general category, however what you will have is some double taxes income, so the CA return there will be credit for the taxes from MA on the amount that was taxed by MA and CA for that one month of income.
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Level 2

I believe my W2 is wrong - CPA told me to file the correction I think is correct. Is this right?

Thanks! How can I tell how much the amount was that she was double taxed by MA and CA? All I have is the end-of-year state wages for MA and CA.
Level 12

I believe my W2 is wrong - CPA told me to file the correction I think is correct. Is this right?

MA can tax all the income she earned as an MA resident.  CA can tax all the income she earned as a CA resident, including the income for her one month of remote work done in CA for the MA company.  MA cannot tax a non-resident on income from work not actually performed in MA.  You became CA residents when you moved into your new home in CA.

If you can't get a corrected W-2 from the employer, and you want to correct the W-2, you do so by filing a Substitute W-2 using IRS Form 4852.  https://www.irs.gov/pub/irs-pdf/f4852.pdf

To do this, revisit the W-2 in TurboTax, go through the questions.  You'll be asked "Do any of these uncommon situations apply to this W-2?"  Check the box that says "Substitute form".  That should cause TT to generate Form 4852.