My relative is an Illinois resident but worked in Detroit, Michigan last summer. Because of the reciprocal agreement between Michigan and Illinois, his wage is not taxed by the State of Michigan. However, the Detroit City tax was withheld on the wage.
He would like to claim it as a tax credit when filing his IL state tax return.
On his W-2, his income is listed in box 16 as state wages, and in box 15, the state is IL. Additionally, the income is also shown in box 18 as local wages, with box 19 indicating the locality as Detroit. Can he include this income in his IL Schedule CR, Column B, for the Non-Illinois Portion?
The following instruction in Schedule CR IL-1040 seems self-contradictory:
"Line 1: Wages, salaries, tips, etc.
Enter the amount of wages not shown as Illinois wages on the state copy of the W-2 form(s) you received. Do not include wages taxed by another state if they are also shown as Illinois wages. Also do not include any wages you received for working in Iowa, Kentucky,
Michigan, or Wisconsin while you were an Illinois resident, unless you paid tax to a city or county on these wages."
His wage shows as Illinois wages in his W-2, but he paid tax to a city in Michigan on this wage. Should he follow instruction in
1) Enter the amount of wages not shown as Illinois wages on the state copy of the W-2 form(s) you received?
Or
2) ...unless youpaid tax to a city or county on these wages?
If he follows (1), he should not enter his wage in column B on IL Schedule CR. However, if he follows (2), he should.
