What exactly am I supposed to fill in for AZ form 309?

[GinaG · Accepted solution]

Hi there!  AZ Form 309 is needed in certain situations.  https://ttlc.intuit.com/replies/6889144 contains a bit more on this. In addition to see the actual form you can go to https://azdor.gov/forms/tax-credits-forms/credit-taxes-paid-another-state-or-country.  This form is only needed if you paid net income taxes to a state other than AZ (or another country) and are filing a return for that state.

[GuyJ]

It depends. Per the AZ form 309 instructions:  https://azdor.gov/file/6762/download?token=DPQXB2FW

Complete this form only if you meet the following:

1. You are filing a 2018 Arizona income tax return.
2. You paid a net income tax to another qualified state or country for 2018.

• If you are claiming a credit for taxes paid to another state, payroll taxes withheld from income do not constitute a net income tax. Having tax withheld from your pay by Arizona and another state does not by itself qualify you for this credit. You must file a net income tax return to the other state.
• If you are claiming a credit for taxes paid to another country, a net income tax paid to another country includes those taxes that qualify for a credit under Internal Revenue Code (IRC) §§ 901 and 903.

However, TurboTax primarily determines which state tax returns you need to file based on what you enter on the My Info tab in TurboTax Online or PERSONAL INFO tab in TurboTax CD/Download and related income sources, i.e. W-2. Typically, a credit for taxes paid to another state is claimed on the resident state tax return for double-taxed income on the nonresident state tax return. Typically, if you have part-year resident state tax returns, you should allocate income on each state tax return and you would not have double-taxed income. You should allocate income and complete nonresident state tax returns first (if applicable), part-year resident state tax returns second (if applicable), and resident state tax returns last (if applicable). Please review the following link(s) and the link(s) embedded on the webpage(s) for more information:

• What is my state residency status?
• When would I have to file returns in more than one state?
• Multiple States—Figuring What's Owed When You Live and Work in More Than One State
• How do I file a nonresident state return?
• How do I file if I moved to a different state last year?
• How do I file a part-year state return?
• How do I allocate (split) income for a part-year state return?
• How does TurboTax calculate taxes on part-year returns?
• How do I prepare a full-year resident state return?

[Marcie123]

We are AZ full time residents.  We paid foreign tax via our 1099-DIV therefore we do not have to file a foreign ITR but just input the Foreign Income and Foreign Tax Paid to be calculated on AZ Form 309. We also have an AZ tax credit on AZ Form 322 for Contributions Made to Public Schools. Both the AZ Forms (309 and 322) should flow through to AZ Form 301.  Why doesn’t Form 309 show up ANYWHERE in the TurboTax worksheets or on Form 301?   I input the information.  EVEN IF WE HAVE TO APPLY THE PUBLIC SCHOOL CREDIT FIRST THERE SHOULD BE A RECORD THAT THE FOREIGN TAX INCOME AND CREDIT WERE ENTERED AND AMOUNT CALCULATED SO I DON’T HAVE TO GO BACK INTO THE INPUT TO MAKE SURE THAT I DID INDEED INPUT THE INFORMATION.   I find TurboTax NOT as user friendly as it used to be.