YR
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VA resident with erroneously withheld DC wages

I am a VA resident and work in DC on a part-time basis. My employer erroneously withheld my wages for DC income taxes for 2018. I have left the company in December. 


Is there a way to claim a refund for the DC withheld wages? Does Turbo Tax have a function to do that? Thanks. 

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‎June 3, 2019 12:07 PM
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Rachel_W
Expert Alumni
Expert Alumni

State tax filing

Yes, you can file a DC Nonresident return to get the DC state taxes withheld as a refund.  You will be able to prepare both your Virginia Resident and DC Nonresident returns in TurboTax.

Because VA and DC have a  reciprocity agreement, you pay income tax only to the State you *live* in, which in your case is Virginia.
    In TurboTax, follow these instructions to indicate that you are a resident of VA that worked in DC:
    • Log into your Turbo Tax Online account.
    • Select "Take me to my return"
    • Click "My Info" located on the left side of your screen
    • Scroll down and click "Edit" next to "Other State"
    • Answer "Yes" to "Did you Make Money in any Other States?"
    • Choose "DC" from the dropdown menu that pops up

    When you have completed your Federal return, click "State" from the left side of your screen and TurboTax will walk you through the preparation of both State Returns.  Be sure to do you DC return first, and then your VA.

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      ‎June 3, 2019 12:07 PM
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      tkeirnan
      New Member

      State tax filing

      My employer had me withholding DC taxes even though I am a resident of VA. As TurboTax had it, I ended up doing VA only and I have now added DC. Why is it important to do DC first and then VA?

      ‎April 14, 2022 8:51 AM
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      TomD8
      Level 15
      Level 15

      State tax filing

      @tkeirnan --

       

      File DC Form D-40B to obtain a refund of the incorrectly withheld DC taxes.  If you did not reside in DC in 2021, it is not necessary for you to file a DC tax return.  You can download Form D-40B here:

      https://otr.cfo.dc.gov/node/1576061

       

      If you haven't done so already, advise your employer that you are a resident of VA and ask them to begin withholding taxes for VA and cease withholding for DC.

       

       

      **Answers are correct to the best of my ability but do not constitute tax or legal advice.
      ‎April 14, 2022 8:59 AM
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