Credit for taxes paid to another state is allowed by a resident state when the same income is being taxed to another state. Your resident state does not want you to pay tax twice on the same income. The credit that is allowed will be the lesser of:
- the tax liability actually charged by the nonresident state, OR
- the tax liability that would have been charged by your resident state
If the state returns are prepared in the correct order (nonresident state first) your resident state will know the appropriate tax amount to credit you. It is not determined by the state withholding by the employer.
You should clear your cache and cookies. It handles many issues that seem nonsensical on a regular basis.
- Close your TurboTax return first.
Watch to be sure you are selecting 'all time' as example. Do not use selections like 'last hour' for those browsers that give you options.
Finally, double check the actual tax liability by the nonresident state, then review your resident state return to see if the correct amount is in place.
@christinasherpa
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