The general rule is that you owe taxes to the state where you live and to the state(s) where you work.
You owe tax on the income that you earned IN Oregon to Oregon on a nonresident Oregon return. Please see page 5 on the 2022 Oregon Income Tax Form OR-40-N and Form OR-40-P Instructions.
You owe tax on the income to Arizona that you earned IN Arizona on an Arizona resident return. Did you work any while in Arizona? If so, then you will be taxed on that income on the 2022 Arizona Form 140.
In TurboTax, you will:
- Enter your Oregon data first for your Oregon nonresident return. This will calculate your Oregon tax.
- Then you will enter your Arizona data. Your Oregon tax should appear (automatically) on AZ form 309 as a "Credit for Taxes Paid to Another State or Country" - this is how you avoid taxes from multiple states on the same income.
Just to clarify, you will report ALL of your income on your Arizona return, but since you will report a tax credit on your AZ return equal to the tax on income earned while working in Oregon, you will not be double taxed on the same dollars.
@Parthshah1985
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