@davey111 wrote:
So how are they able to and and why did they include this on my 2019 w2 when it was 2018 income? Can I get them to change it? Doesn't seem correct or fair.
You don't actually know when the moving company was paid, you are only assuming it was in 2018. If the moving company was paid in 2019, that is 2019 income to you, and since you were an Arizona resident in 2019, it is Arizona taxable income. I would suspect that the DoD did not pay the movers right away. 30 days would be a minimum, and longer is certainly possible.
If you want to assert that the moving company was paid before November 12, 2018, you will have to prove it. One way would be to get a corrected W-2. Another way would be to get a statement from the movers, if they can even find the documents and are willing to provide them.
If you wanted to stake a consistent claim that this was 2018 income, you would have to file an amended 2018 return to report this as federal taxable income, and then file amended 2019 returns to remove it. (Or, if these questions are the result of you getting a corrected W-2 and trying to figure out if you need to amend 2019, you would amend 2018 instead.). You would then expect to get a letter from Arizona assessing tax and penalties for not reporting the income for 2019 and paying tax. You would have to explain your argument that this was income from before your change of domicile (November 12, 2018) and see if they accept it. You would probably also get a letter from the IRS, and you would have to make the same explanation to them, with the added note that you reported the income and paid the tax on your 2018 return. Either agency could rule against you.
You would have to make the argument that the fact that the moving company moved you in 2018 proves constructive receipt of the money in 2018, even if the DoD didn't pay the movers until 2019.
https://www.law.cornell.edu/cfr/text/26/1.451-2
