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How does TurboTax calculate the "Tax Paid to California on Double-Taxed Income" amount?

I lived in Colorado but worked in California earning some income and am filling out my Colorado state return. When trying to calculate my Other State Tax Credit it looks like TurboTax is pulling the "Colorado income from Sources in California" amount from my California W-2 box 16 (State wages, tips, etc.), but how does it determine the "Tax Paid to California on Double-Taxed Income" amount? Should it be the same as my California state income tax (California W-2 box 17)? The provided number does not match that.

Additionally it says "Note: Enter your tax after credits from your California return. Do not reduce this by withholding or estimated tax payments you made." When reviewing my California state return I don't see any credits received, which leads me to believe that this should affect the tax paid on double-taxed income.

Thanks!

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1 Reply
Anita01
New Member

How does TurboTax calculate the "Tax Paid to California on Double-Taxed Income" amount?

You should NOT use your W-2 withholding amount for the other State tax credit. It's not the tax paid to CA, it's an amount withheld but you may get some f it back from CA or you owe more in CA. You prepare the CA return first, then, when you do CO, the program will automatically transfer the correct numbers to CO.  The note about credits and estimated payments is telling you not to change the amount calculated by the program.

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