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vista25
Level 1

I live in CA and work in MD. Does CA credit state AND local tax pd to MD?Both are on the MD return & all pyts go to Comptroller of MD (not to any local taxing authority)?

In the instructions on CA FTB Schedule S line 7, it says to only include taxes paid to the other state and to not included taxes paid to localities or cities. On the schedule itself, line 7 says "income tax liability paid to name of other state."  The Maryland tax return does separate calculations for state and local taxes, but all taxes are payable to the Comptroller of Maryland (ie, no taxes are paid by me directly to any locality)....just to Maryland.  Can I add both state and local taxes paid to Maryland and use that total on my CA Schedule S as taxes paid to another state?
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Accepted Solutions
DanielV01
Expert Alumni

I live in CA and work in MD. Does CA credit state AND local tax pd to MD?Both are on the MD return & all pyts go to Comptroller of MD (not to any local taxing authority)?

Unfortunately, no, you can only include the state tax paid.  It is true that some states do calculate both state and local taxes on the state return, but, as you mention, they still consider them as separate "buckets" so to speak.  There are some states that do give credit for local taxes paid to other states because of this, but California is not one of them.  

TurboTax will actually do this for you if you first prepare the Maryland return.  It will calculate the correct amount and carry it over to your California return to get credit for the taxes paid to another state (in this case Maryland).  Here is an FAQ with instructions on how to do this:  :  https://ttlc.intuit.com/replies/3302052

Also, you may qualify for certain deduction on your Federal return if you were travelling to Maryland to work.  Here is an IRS Publication link that talks about what you may be able to deduct:  Publication 463.  (If you have questions, feel free to comment and I'll be happy to assist).

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3 Replies
DanielV01
Expert Alumni

I live in CA and work in MD. Does CA credit state AND local tax pd to MD?Both are on the MD return & all pyts go to Comptroller of MD (not to any local taxing authority)?

Unfortunately, no, you can only include the state tax paid.  It is true that some states do calculate both state and local taxes on the state return, but, as you mention, they still consider them as separate "buckets" so to speak.  There are some states that do give credit for local taxes paid to other states because of this, but California is not one of them.  

TurboTax will actually do this for you if you first prepare the Maryland return.  It will calculate the correct amount and carry it over to your California return to get credit for the taxes paid to another state (in this case Maryland).  Here is an FAQ with instructions on how to do this:  :  https://ttlc.intuit.com/replies/3302052

Also, you may qualify for certain deduction on your Federal return if you were travelling to Maryland to work.  Here is an IRS Publication link that talks about what you may be able to deduct:  Publication 463.  (If you have questions, feel free to comment and I'll be happy to assist).

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
vista25
Level 1

I live in CA and work in MD. Does CA credit state AND local tax pd to MD?Both are on the MD return & all pyts go to Comptroller of MD (not to any local taxing authority)?

Thank you. Very helpful.
DanielV01
Expert Alumni

I live in CA and work in MD. Does CA credit state AND local tax pd to MD?Both are on the MD return & all pyts go to Comptroller of MD (not to any local taxing authority)?

It's an honor.
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
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