I lived in MN for the first 3 months of 2020, then moved to IA for the last 9 months. still working for the same company. My W2 shows the taxes withheld for both MN and IA with appropriate % of withholdings for each state.
When I completed my MN state return, it was using 75% of my federal gross income as taxable for the MN state calculation, not the 23% of the gross that was on the W2. Total federal gross minus "Minnesota subtractions" was 75% of my federal gross stated as taxable. I calculated my interest and capital gains from the dates when those items occurred. After completing the MN return, I have a small amount I need to pay in to MN (0.2%).
When I completed my IA state return, it asked about part year resident credit. The value entered for my "Joint Iowa Sources" was 70% of my federal gross, pulled from my W2. It then asked me for the "Double Taxed Income" between MN and IA. I entered in the 70% value as it appears that MN was using my IA income. The 70% is lower than the 75% value from the MN return (the 5% difference was capital gains sold in MN). I also entered in the "Tax Amount Paid" to MN as the actual amount withheld for MN. It then asked me for the "Total Amount of Gross Income Taxed by Minnesota" with the description of "Part Year residents only, enter the amount of gross income you received while you were an Iowa resident that was taxed by Minnesota". I used the 70% value as it again as this was the taxable IA income that appears is being used by MN.
It's now giving me a substantial refund in IA (1.7%). But because of the confusing nature of how much is actually taxed by each state. I just want to make sure I am properly entering the values in those state tax credit fields.
Thanks
