I was a part year DC resident moving to Virginia in June. Would My DC tax bracket/tax rate be based on the full year's income or only income gained while living in DC?

TurboTax is indicating that I owe ±$2,400 to DC, despite having income withheld throughout the time I lived in DC. When I follow the instructions for the D-40 EZ (working quickly to get a ballpark number, using standard deductions, etc.) I seem to find that my tax burden is also landing around ±$2,400. Over $3,000 of my income was already withheld according to my W-2s, so why does TurboTax indicate I owe additional tax to DC? Is it neglecting to account for the withholding on my W-2?

In 2017, I lived in DC from Jan-June, then Virginia from June-Dec. The only thing I can think might make a difference is if my DC income is still taxed at the higher bracket based on my full annual income rather than the income I received while living in DC.

3935

Intuit Alumni

Jun 1, 2019 6:51:11 AM

In the state section of your W-2 (box 15-17), is your income split between DC and VA? Or is the same amount reported to both states?

Intuit Alumni

Jun 1, 2019 6:51:13 AM

Since you were a part-year resident of DC, when you go through the DC portion of TurboTax you will see a screen, Subtractions From Federal Income,Part-year. [Screenshot #1, below] Enter the amount of your income you received after you moved to Virginia.

Otherwise TurboTax will think all the income was attributed to DC.

To make the changes:

Go back into your DC return.
On the screen, You've Finished Your District of Columbia Return, click the Update box next to Adjustments.
On the next screen, Items Taxed by DC, click Done.
Go through the screens until you reach Subtractions From Federal Income, Part-year. In the box, enter the portion of your income you earned while living in Virginia. Click Continue when done.

New Member

Mar 18, 2020 7:21:45 PM

@IreneS

If the income is split into two in box 15-17 (one showing DC income, one showing VA income), are you still supposed to put all income made after the move to Virginia in the "Subtractions from Federal Income, Part-Year" field?

Thanks

Expert Alumni

Mar 19, 2020 5:15:15 AM

No - As long as the amounts on your W-2 seem correct for the VA and DC allocation, you don't have to do anything. TurboTax will pick up the amounts from the W-2.

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I was a part year DC resident moving to Virginia in June. Would My DC tax bracket/tax rate be based on the full year's income or only income gained while living in DC?