I lived in CA and worked in CA. Why do I owe MA state taxes?

[karleyh15]

I lived in CA and worked in CA. I have a part-time job for extra income, that company is located in MA. Why do I owe MA taxes if I never worked in MA? I am getting a note when I go to apportion my income that says when MA is in Box 15, I cannot apportion my wages. I have two w-2's from this company, one with CA in box 15 and one with MA. Why does it say MA if I never worked in MA?

Thanks for the help.

[DanielV01 · Accepted solution]

You are correct that this is a withholding error by the company.  The fact that they are located in MA does not mean you pay taxes to MA if you did not work in MA.  (To be taxed in Massachusetts you must be physically present in Massachusetts).  Since you are not located in MA, you do need to file a Massachusetts return with a zero income.  This requires you to mail in your Massachusetts non-resident return.  What you may have to do in TurboTax is on the W-2 screen in TurboTax report a zero in box 16 on the MA line.  Keep box 17 the same.  You will get a diagnostic error, but since you will mail in the Massachusetts return you will be prevented from e-filing your Federal and California return.

When you file the Massachusetts return, you will want to submit proof that you worked within California and not Massachusetts.  If you are still working for that company, you want to advise them that you are not supposed to be taxed in Massachusetts.

[karleyh15]

Thanks for your Response Daniel. Would it be easier to ask the company for a corrected W-2? Once I have that I can re-enter the form in TurboTax and e-file all of my returns?

Thanks again!

[DanielV01]

A corrected W-2 probably won't work if MA taxes were withheld.  (They might be able to correct the line 16 to a zero, but even then you won't be able to e-file.  It doesn't pass Mass's e-file diagnostic).

[karleyh15]

No MA taxes were withheld, box 17 is blank. Does that mean a corrected W-2 will fix the problem?

[DanielV01]

Yes.  So since no MA taxes were withheld, don't file a MA return.  If they ask why, you can provide them with proof that you lived and worked in California.  (It shouldn't be too hard to prove that you weren't making 3,000 mile daily commutes.)