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State tax filing
With SC in box 15 the income and withholding was reported to SC. There will be no correction; the W2 is reporting what the employer already did. On your tax return, however, you get to pay the right taxes to the right states.
NY, your non-resident state, only taxes NY source income. SC is your resident state and taxes income no matter where it is earned. However, you can claim a credit on your resident SC return for taxes paid to another state to mitigate the double taxation.
As @PaulaM stated you will need to file a non-resident NY return to report the income earned in NY and since there was no withholding you will likely owe a tax there. Once you complete the NY non-resident return take note of the income taxed and the NY tax liability. Those are the numbers TurboTax will use to help you claim a credit on your resident SC return.
The SC withholding and the credit for taxes paid to another state will reduce any SC tax you may owe and possibly yield a refund depending on your other income and withholding amounts.
Here are the steps to generate the NY non-resident return.
- In the "My Info" section
- Scroll down to "Other State Income"
- Answer "Yes" you earned income in another state
- Select "NY"
- Continue
- After entering your income and deductions in the federal interview
- Start the NY interview
- Complete/Verify the residency questions
- Next will be the income questions where you will allocate the W2 amount that belongs to NY
- Any other non-NY income sources be sure to allocate zero "0" to NY
- After completing the NY interview then you can work the SC resident state interview
- In the credits section is where you will find the credit for taxes paid to another state
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