Multiple State Tax Returns

[wjrez]

I lived in North Carolina and my office was in South Carolina. I paid taxes in both states. When I did my NC resident return, I received a credit for SC taxes paid (less than the SC taxes I actually paid) and had to pay $0 in tax to NC. However, I then filed a nonresident SC return. The TurboTax form did not show me anywhere to show what taxes I paid in SC. After completing the form, I then show I have to pay them over $1100 when I had already paid them taxes during the year. 

[AnnetteB6]

You should go through your North Carolina and South Carolina returns again.  When you are filing a non-resident return and a resident return, you should complete the non-resident (South Carolina) return first.  Then the accurate credit for taxes paid to another state can be calculated on your resident (North Carolina) return.

You mentioned that you already paid taxes to both states.  If you are referring to having state taxes withheld from your paycheck, then entering your W-2 will take care of reporting that information to your state returns.

If you paid estimated taxes to one or both states, then that information should be entered in your Federal return.  Those estimates may be counted as part of your Schedule A Itemized Deductions, so that is why they are entered in the Federal return.  Use the following steps:

Use the following steps to enter the state estimated payments:

• On the top row of the TurboTax online screen, click on Search (or for CD/downloaded TurboTax locate the search box in the upper right corner)
• This opens a box where you can type in “estimated tax payments” and click the magnifying glass (or for CD/downloaded TurboTax, click Find)
• The search results will give you an option to “Jump to estimated tax payments”
• Click on the blue “Jump to estimated tax payments” link
• Click Start beside State Estimated Taxes for 2021 to enter your information 

[wjrez]

Thanks forresponding, but what concerns me is that I paid my full taxes to both states yet SC wants an additional $1100 . I would have thought that being a resident of NC and paying SC taxes, that the SC taxes should have been rebated to me and I would owe them nothing as I lived in NC that entire time.

Why would that not be the case?

[MaryK4]

For state taxes, the general rule is a nonresident pays income tax on wages in the state where the work was performed and residents pay taxes on all income regardless of where it was earned.  So that you are not double taxed on the same income, you get a credit for the taxes paid to the nonresident state on your resident return.  

@wjrez

[SteamTrain]

And...you might owe more to SC because you may not have paid enough with regular SC withholding.  SC marginal income tax rates are "up-to" 7% ....wile NC is fairly flat at ~5%.