Charged taxes from different state (with state income tax). Filing as a non-resident.

[Ag1223]

I live in a no-income-tax state, and was charged taxes from a different state that has income tax for 2 pay periods. My company gave me a W2 and a W-2c. When filing with TurboTax, under the Federal 'Wages and Income' section, I am filing based off of my W-2c (putting only one state in box 15, not 2). Is this correct?

When I go through the 'State Taxes' section, I don't see anything where I can report that I paid taxes and had state wages.

Do I need to use my W2 and not W-2c in the federal section? If not, how do I make sure I get reimbursed for the state income tax I paid for 2 pay periods?

[MaryK4]

You would want to enter the information from your W2-C- if it shows that they made the corrections to the state withholding, you would not have to file in the nonresident state.

If your employer made the correction before the due date for the nonresident state, they would have refunded you the incorrect withholding with your pay when the error was corrected- so you would be able to see it on your pay statements.  If they did not make the correction, they would NOT have issued you the W2C.  

[Ag1223]

The W-2c shows the correct distribution (all income in one state, and none in the other). However, the correction was not made until after the state's tax due date, so I did not get this money refunded in my usual pay statement. Based on this, it sounds like I should go ahead and file the information in my W2 (not W-2c) and also file as a nonresident in the additional state. Would you agree with this?

My company has given me the following instructions: "Since this adjustment was made in January 2025, Payroll had to create a W2-C to adjust your prior year earnings. The state taxes, however, have already been paid out to the state since this adjustment was not made prior to December 31st. We strongly advise that you file for your tax return in [the additional state] so that you may receive a refund for these taxes that you had paid."

[Ag1223]

Based on the above information, should I file the information in my W2 (not W-2c) and file as a nonresident in the additional state in the 'State Taxes' section of my filing?

If not, how do I go about getting back the state income taxes paid from the other state?

[KeshaH]

If your employer isn't going to refund you, you will usually need to file a nonresident return and indicate that you didn't earn any income in the state to get a refund of the taxes that you paid to the state.

[Ag1223]

How do I indicate that I did’t earn any income in the state but still paid tax? 

[KeshaH]

When you work on the nonresident return, you'll generally be asked to allocate your income to that state. Enter 0 in all of the boxes. What's the nonresident state that you'll be filing? That will help us guide you through the process.

[Ag1223]

The state is Arkansas. Do I need to complete my current filing and then start a new one, or can I combine my current one and then add this into it?

I’m not sure if I need to add another W2 and just say 0 income with the amount in state income tax, or utilize the “State Taxes” portion. When I tried to go through the “State Taxes” portion on my current return and file as a nonresident in Arkansas, I never came across a place to say I had 0 income but had state income tax to report.

[KeshaH]

You would enter your W-2 as is with the Arkansas income and withholding. In the state tax section, you will come to a screen titled Remote work. Click the button at the bottom to indicate that you were a remote worker. This is needed to get to the income allocation screens.

On the next screen, change the Arkansas amount to 0. You should see your refund for Arkansas change to the amount of tax that you paid.

[Ag1223]

Okay great. I will try this and let you know if I have any issues. Thank you for the help!