non-resident state tax

[bipink888]

Hi

I was a resident of NC for the entire year of 2020, I used to live in PA  and moved to NC in July 2019.  my employer -in error-  paid PA state taxes until July 2020 even though I never worked or lived in PA.  As I am filing taxes for 2020, I completed my NC tax return first and then purchased and completed the PA tax return. However when I run the smartcheck it gives me an error on the NC tax return  stating that earned income in PA state cannot be zero. I have changed the income on my PA return and it still gives me the same error, any ideas or thoughts on how to resolve.

[ErnieS0]

Delete your Other State Tax Credit information in North Carolina. You will see it on the screen Take a look at North Carolina credits and taxes.

If you are reporting $0 Pennsylvania income, you are paying no tax, and are not entitled to any credit.

When PA tax is withheld in error, file a PA-40 Income Tax Return. Be sure to indicate your residency status as "nonresident".

Submit a legible photocopy of your Form W-2, and a SIGNED COPY of the resident income tax return that you filed/will file with your resident state (without the supporting forms and schedules), and a statement explaining that you were a resident of a reciprocal agreement state.

Refer to the instructions for residents of a reciprocal state for more information (they are the same in for employees with tax withheld by mistake).