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Level 2
June 5, 2019
Solved

My royalty income should be sourced in Oklahoma, but Turbo Tax has sourced it in California (my residence) How do I correct my California return. Oklahoma has already fixed it for me.

  • June 5, 2019
  • 1 reply
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Best answer by DanielV01

It's taxed in both.  While the royalties are not "California-sourced" income as such, California is allowed to tax all of your income because it is your resident state.  You won't be able to remove the income from the California return.  However, to limit the effect of double-taxation, you will receive a credit on your California return for the taxes you pay to Oklahoma on this same income.  But the royalties will be included in California taxable income, because you live there.

1 reply

DanielV01
DanielV01Answer
Level 15
June 5, 2019

It's taxed in both.  While the royalties are not "California-sourced" income as such, California is allowed to tax all of your income because it is your resident state.  You won't be able to remove the income from the California return.  However, to limit the effect of double-taxation, you will receive a credit on your California return for the taxes you pay to Oklahoma on this same income.  But the royalties will be included in California taxable income, because you live there.

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Level 2
June 5, 2019
Thank you. So I need to apply for a credit on my California return. Oklahoma had amended my return for me and adjusted my refund. I guess I can manually file in California for what I had to pay to Oklahoma