Q. Do I have to pay income tax to Lancaster AND Columbus?
A. Yes. See next question, for explanation.
Q. Is there a credit of some sort when you work in one city and live in another?
A. Yes. But while many cities allow a full credit, Lancaster does not. Lancaster allows only 1%, maximum.. So, you will pay 0.75% to Lancaster at tax filing time. But you say your Husband's employer withholds for both. USUALLY, when that happens, the employer has already adjusted for the credit. You may owe nothing, but you still have to file a Lancaster return.
Q. Do they "have to" take both city income taxes out of my check to avoid owing?
A. No, they are only required to withhold for the work city. But, many employers will voluntarily do both and adjust for the credit so that yo do not owe at tax time.
Although TurboTax can do some Ohio city returns, Lancaster is not one of them.
City income tax web site https://www.ci.lancaster.oh.us/191/Income-Tax
