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How do I get my Maryland wage taxes back? I live in West Virginia and Worked in Maryland. My employer withheld MD Taxes not WV Tax, How to get MD Tax Back?

 
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2 Replies
DawnC
Expert Alumni

How do I get my Maryland wage taxes back? I live in West Virginia and Worked in Maryland. My employer withheld MD Taxes not WV Tax, How to get MD Tax Back?

Your employer should have withheld MD tax since you did work IN Maryland (unless you gave the employer Form MW507, see below).    Since you worked in one state and live in another, you have two state tax returns to file this year.  A resident WV return - your resident state taxes all of your income.    And a MD nonresident return - the nonresident state will only tax your MD sourced income (income you earned while being physically present in MD).    Whatever amount of tax you end up paying to MD will be a tax credit on your WV resident return.    When you prepare your returns, do the MD nonresident first.  This way TurboTax will automatically apply the credit to your resident return - which will ensure you are not double taxed on any of your income.   

 

The link above has instructions.   

 

Maryland and West Virginia have reciprocity.  If you are still working for that employer (or any other employer in MD) - you can give the employer a completed Form MW507.   This will instruct the employer to withhold taxes for WV instead of MD.   This will eliminate the need to file the nonresident return in future tax years.  

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How do I get my Maryland wage taxes back? I live in West Virginia and Worked in Maryland. My employer withheld MD Taxes not WV Tax, How to get MD Tax Back?

I have a different opinion of this issue:

  • There is state tax reciprocity between Maryland and West Virginia.
  • Your employer's payroll provider should know this and should not have withheld Maryland state tax
  • You should complete the Maryland form 505 and follow the instructions to this form.  In doing this, you will be requesting all of the Maryland withholding as a refund.  See instruction 4 on the link below (your applicable section is almost at the end of this instruction 4 on page 2)
  • https://www.marylandtaxes.gov/forms/21_forms/Nonresident_Booklet.pdf
  • West Virginia will not allow a credit for state tax paid to a state where there is reciprocity; See W. VA Code R Section 110-21-20.3
  • Unfortunately as a result of this, you will owe WVA tax on your wages and then wait on your refund from MD.
  • You need to make sure your employer has a current form MW507; which they should have requested in the beginning.
*A reminder that posts in a forum such as this do not constitute tax advice.
Also keep in mind the date of replies, as tax law changes.

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