Preparing taxes for 2 states

[vankurtz]

I have 2 sources of income, each from a different state. How or where in TurboTax do I indicates which source is taxed in which state?

As of two years ago, TurboTax asked me that question. It listed each source of income and asked me to specify in which state it was taxed. This made it very easy.

NOW, TurboTax does not ask that question or does not indicate where to make the division. It assumes all income was made in my state of residence, no matter with which state I begin preparing its taxes.

For what it is worth, my normal income is made in my state of residence. The other source is from an LLC registered in the other state, but it address is in my state of residence.

SO, where in TurboTax do I indicate which sources of income that are taxed in each state?

Thanks

[RobertB4444]

While the tax rules vary from state to state as to what income is taxable and what is not the rules on how to handle it in TurboTax are pretty simple.

Start with preparing a return for the non-resident state.  Since TurboTax is assuming that all of your income is taxed to your resident state you will have to tell the system what income is taxable to the non-resident state and what income is not.

Once you have completed the non-resident return and all of it is set properly then you proceed to the resident state tax return.  Depending on the state you will either tell it not to tax the income from the other state or allow it to tax the income as well but take a credit for the taxes paid to the non-resident state.  Either way prevents double taxation.  

It'll all be fine as long as you make sure to do the non-resident state first.  If you have already started something different then you will need to delete any state returns and start over.

@vankurtz 

@vankurtz