If I live in OH and work 100% remote but my employers HQ is in CA, what is my state income tax situation? Do I pay CA state income taxes or OH state income taxes or both?

[DoninGA]

If you did not physically work in CA and you will not have CA state income taxes withheld on the W-2 you receive from your employer there is no need to file a CA state income tax return.  All of your income is reported on your OH state income tax return.

[mrpibbxtra]

Thanks for your quick reply. I changed my permanent residence from CA to OH in February, so I'm assuming I might have January and February to deal with where I still need to do the California return. However, I noticed that my employer never changed my address so I've had CA taxes withheld this whole time since February. I saw elsewhere online that I might get a credit for that since it wasn't properly withheld?

[mrpibbxtra]

Thanks for your quick reply. I changed my permanent residence from CA to OH in February, so I'm assuming I might have January and February to deal with where I still need to do the California return. However, I noticed that my employer never changed my address so I've had CA taxes withheld this whole time since February. I saw elsewhere online that I might get a credit for that since it wasn't properly withheld?

[DoninGA]

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@mrpibbxtra wrote:

Thanks for your quick reply. I changed my permanent residence from CA to OH in February, so I'm assuming I might have January and February to deal with where I still need to do the California return. However, I noticed that my employer never changed my address so I've had CA taxes withheld this whole time since February. I saw elsewhere online that I might get a credit for that since it wasn't properly withheld?

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OK then...You will have to file two part year state income tax returns.  One for CA and one for OH.  On the CA return you only enter the income received while a CA resident.  On the OH return you only enter the income received as a OH resident.

Any CA state income taxes paid while a OH resident should be credited to your OH state tax return.

In the My Info section of the TurboTax program you are asked for your resident state.  You should enter OH.  You are asked if you lived in any other states, you should answer Yes and select CA as the state.

@Hal_Al Anything further for this OH resident?

[mrpibbxtra]

Thank you! I appreciate your help!

[Hal_Al]

The above answers assume you are a regular W-2 employee.  The answer will be different if you are a contract employee/independent contractor receiving a 1099-Misc or 1099-NEC. 

Be advised that Ohio does a convoluted tax calculation for non-residents/part year residents. It calculates tax on total income, then it calculates a non resident/part year resident credit, which it subtracts from the tax it calculated on the total income. The credit is calculated as your non-Ohio income divided by Total adjusted Income multiplied by the total tax. TurboTax (TT)   does this by allocating your income as either Ohio or non-Ohio. W-2 income will be allocated by the state name abbreviation shown in box 15 of your W-2. TT will ask you, item by item, in the state section, how much of your other income is Ohio or non-Ohio income.

Be advised that you will probably have to use a work around to get TT to prepare the OH return correctly. At the w-2 screen split the boxes 15-20 W-2 info into 2 lines. On the 1st line put OH in box 15 and the portion of the CA income since Feb in  box 16. Leave box 17 blank.  On the 2nd line put CA in box 15 and the  wages  before the move  in box 16; leave the CA withholding in box 17.

 

[Hal_Al]

@DoninGA wrote: 

   Any CA state income taxes paid while a OH resident should be credited to your OH state tax return.

 No. You have to claim a refund on your CA part year resident return for the improper withholding. 

[mrpibbxtra]

Thank you for your great answer! I really appreciate your help! (And I am a W-2 employee)