I was a full time resident of Arizona for 2023. I lived in AZ but worked remotely for a CA company and they deducted CA taxes entirely.
Does anyone know if the AZ state software for Turbotax automatically calculates Form 309 which is used to apply the credit for the taxes I paid in CA?
Reason I ask is i tried an alternative software and I does NOT include Form 309 and I am having trouble filling it out manually.
And will purchase Turbotax if someone can confirm that it will do it automatically as a standard form.
Yes, TurboTax does handle credits for taxes paid to states other than your resident state. Having said that. AZ and CA have a reciprocity tax agreement. CA tax should not be withheld for AZ residents. You only need to file and pay taxes in AZ.
Since your employer withheld CA taxes you need to file a CA non-resident tax return and claim zero CA source income to get those CA taxes refunded.
Further, you need to go quickly to your employer and have them stop withholding for CA and start for AZ as an AZ resident. If CA withholding has already occurred in 2024 you will need to follow the steps below next year as well. Ultimately once only AZ taxes are withheld, you only need to file in AZ.
In the "My Info" section in TurboTax:
This will generate the CA non-resident return.
After entering your income in the federal "Wages & Income" section, you can click the "State Return" in the left hand menu and "Start" your CA non-resident return.
In the CA state return interview during the "Income" set of questions, all of you income will have transferred in so you will allocate zero "W2 Wages" to CA (and zero for all other categories if applicable). This will refund all CA taxes.
As an AZ resident all of your income will be reported in the AZ interview (transferred automatically from your Federal interview).