Employer paid state tax twice

[sreiling]

My daughter lives in MA and worked for 3 months for an employer in OH and lived there for 3 months on a temporary basis. The employer deducted state taxes twice, for MA and OH. On the W2 are separate forms for MA and OH. When I enter the W2 into Turbotax I end up with two entries in section "Boxes 15-17 State Wages and taxes withheld" with the same amount of wages for MA and OH.

Once I finish the federal return I get prompted that the total reportable income to MA is twice the wages, since it adds up the wages for MA and OH.

I then choose to only report the wages for MA.

When I proceed to file the return the SmartCheck fails, since I do not report all of the income that came from a different state and I need to file a paper return.

What is the correct to enter and report this income?

[MarilynG1 · Accepted solution]

Did the employer withhold Ohio taxes on the W-2?  

If not, leave out the OH line in Boxes 15-17 in the W-2 entry and TurboTax will not prompt to prepare an Ohio return.

If Ohio tax was paid (as shown on the W-2), you will have to Allocate the income between Massachusetts and Ohio, since the employer did not do so.

Divide the total income by 12, then multiply by 3 to get the three months income earned in Ohio.

Prepare a Non-Resident State Return to Ohio to get the tax refunded to her.  

Since she only lived there for work and did not plan to become a resident, she will still report all of her income to MA and also report the tax paid to Ohio.  

Click this link for more info on How to File a Non-Resident Return.