topic State Allocating for non residency in State tax filing

State Allocating for non residency

NCooper8 — Wed, 15 Jan 2020 19:41:50 GMT

Hi, I am a college student and I work for a large national company, splitting my time at the company in two different locations. While I am at school, I work in New York State, while I am home over breaks, I work in Mass. I have a question about allocation. I am listed as a resident of Mass, and a non-resident for NY. My employer on their W2 has my total wages listed in both parts of box 16 showing the two different state wages. I did a rough calculation and found that they surprisingly came to about a 50/50 split based on adding pay stubs. During the filing process, however, when I get to allocating New Yorks wages, when I put in 50% for wage allocation, the total state wages doesn't seem to change. Also, am I required to fill out the IT-203-A after for New York? As it seems to be quite confusing. Thanks!

Re: State Allocating for non residency

TomD8 — Wed, 15 Jan 2020 20:04:55 GMT

Your resident state of MA can tax ALL your income, regardless of where you earned it.

You non-resident state of NY can tax only the portion of your income that you earned in NY.

Therefore your NY income is taxable by both states.

BUT you'll be able to take a credit on your MA return for the tax you pay to NY on the portion of your income that is taxed by both states, so you won't actually be double-taxed.

In the personal info section of TT, put your state of residence as MA, and indicate that you had other state income from NY. This will prompt the program to generate the correct state tax forms.

Be sure to complete your non-resident NY return before you do your home state MA return, so that the credit flows properly.

Re: State Allocating for non residency

NCooper8 — Wed, 15 Jan 2020 20:56:59 GMT

I seem to be struggling with updating how much was actually earned in New York. On my W-2 that I filled in it states my total income for the whole year under both the MA and NY sections (box 16) and when I try to update how much of the total income was earned in NY (50%) it doesn't seem to update. Furthermore, on the review page for my New York section, it still shows the total for both states as the "Amount we start with for New York" and only shows the standard deduction subtracted.

Re: State Allocating for non residency

TomD8 — Wed, 15 Jan 2020 21:41:13 GMT

Don't edit your W-2. The NY state tax interview will have a screen where you can allocate your non-NY income.

NY uses your entire income to calculate your NY tax rate, but then it taxes only your NY income.