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Level 1

Question

If the city is work in has a 2.5% tax rate and the city is live in has a 2% tax rate but offers a 60% credit do i still owe them taxes?

Forum|Forum|2 months ago
May 20, 2026
2 replies
100 views

I have been told different things but Google says that since the tax rate i work in is higher I would not owe the city is live in.

TurboTax Online

Level 15

We could be more helpful if you would be specific about the state and cities you are asking about.

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**

Level 15

Q. If the city is work in has a 2.5% tax rate and the city is live in has a 2% tax rate but offers a 60% credit do i still owe them taxes?

A. Generally, Yes. 60% of 2.5 % is 1.5%. Since that's less than the 2% resident city tax rate, you will owe 0.5%.

Q. Since the tax rate i work in is higher I would not owe the city is live in?

A. Again, a generalization. It would be true if your residence city allowed an 80% -100% credit. So, no, in your case.

As others have said, for a more concrete answer, you should identify the cities involved.

Generally, even when a city allows a 100% credit, the credit is limited to the residence city tax calculated. You don't get a refund from your home (or work) city when the work city has a higher tax rate.