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posted Apr 1, 2025 8:21:40 PM

IA / IL Reciprocity Missing

Turbotax Premium, I think wrongly, tries to make you file an IL return when you live in IA and work in IL. It reads:

"This money gets taxed twice, by both Iowa and the other state.
But don't worry if you see double-taxed income as you go through your Iowa return. Later on we'll help you get a credit that offsets paying double taxes."

 

Everything I've seen suggests you simply file your IA return like normal and file the non-resident form with your employer. No IL return should be needed, right?

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1 Best answer
Level 15
Apr 1, 2025 8:48:46 PM

you would only need to file an Illinois return if you had non-wage income/loss from Illinois activities, such as a rental OR if your W-2 reflects Illinois withholding. Line 15 would say IL.   Assuming you only had IA wages and IA w/h, you have to fib to Turbotax and say you earned income in no other state. 

2 Replies
Level 15
Apr 1, 2025 8:48:46 PM

you would only need to file an Illinois return if you had non-wage income/loss from Illinois activities, such as a rental OR if your W-2 reflects Illinois withholding. Line 15 would say IL.   Assuming you only had IA wages and IA w/h, you have to fib to Turbotax and say you earned income in no other state. 

Level 15
Apr 2, 2025 5:38:19 AM

If you live in IA and work in IL, file Illinois Form IL-W-5-NR with your employer so as to preclude withholding of Illinois income tax.  Here's a link to that form:

https://tax.illinois.gov/content/dam/soi/en/web/tax/forms/withholding/documents/currentyear/il-w-5-nr.pdf