"it seems like you're directing me to just claim this income as income from a US employer why failed to give me a w-2."
The income IS from a U.S. employer that failed to give you a W-2. A business with an employee in the U.S. is a U.S. employer. It doesn't matter if the employer's headquarters is in another country.
"There's no indicating that this income came from a foreign country"
The income is not from a foreign country. It's from work that you performed in the United States. It is U.S. income.
"There is a Canadian Tax ID number for the employer"
The Canadian tax ID number means nothing to the IRS. There is no place to put a Canadian tax ID number anywhere on a U.S. tax return. Nothing you enter in your U.S. tax return has anything to do with your refund from Canada. Your Canadian refund comes from your Canadian tax return.
"My issue is, I've already been taxed by the Canadian government on that income, and I don't need to pay taxes to two countries for one income."
You need to look into the foreign tax credit. That's a credit on your U.S. tax return for income tax that you paid to another country. It reduces your U.S. tax to compensate for the tax you paid to Canada. It's very complicated, and I don't know much about it.
You could just go through the foreign tax credit interview in TurboTax. Go to Federal Taxes > Deductions & Credits. Under "Estimates and Other Taxes Paid" click the Start button for Foreign Taxes. I don't know how thorough this is.
You also need to take into account the tax treaty between the U.S. and Canada. I have no idea how that might affect your situation. This is one reason that you probably should consult a local tax professional who is familiar with U.S. and Canadian taxes.
In preparing your Canadian tax return, keep in mind that the income you received from your Canadian employer is U.S. income, not Canadian income. You earned it for working in the United States. You did not work in Canada. I'm not familiar with Canadian tax laws, but they probably should not have issued the T4, and probably should not have deducted Canadian tax from your pay. This is something else to discuss with a tax professional. Your situation is made more complicated by the employer not having handled it correctly.
There is another Champion in this U.S. TurboTax community who is more familiar with foreign taxes than I am. I don't know how much he knows about Canada specifically, but let's ask him. @pk can you help with this?
