2023 NY state tax counting both DC plus NY state income

[mehtaym]

My child had 2 jobs and each issued a W-2 for 2023.

One is in DC for 7K

One is in NY for 16K

For the federal tax return, total in come is 23K

On the NY State tax return also, Turbo Tax is showing 23K as income. Is that correct? I would expect NY State to not tax the income that was earned in DC.

[rjs]

Is your child a full-year New York resident, filing Form IT-201, or is she a nonresident or part-year resident, filing Form IT-203?

Which line of Form IT-201 or IT-203 has the $23,000 of income?

[mehtaym]

Thanks for the quick response!

Non-Resident filing IT-203

Line 31 has 2 numbers - Federal 23K, New York 16K

Line 32 is where it pulls the Federal amount of 23K

[rjs · Accepted solution]

That's correct, but it doesn't mean that New York is taxing the full federal income. The way New York calculates the tax, it first calculates tax on your entire federal income, after New York adjustments. But then it applies an "income percentage" that is your New York income as a percentage of your total income. That's how it adjusts the tax based on how much of your income is taxable by New York. You can see this on page 3 of Form IT-203, on lines 45 and 46. It uses the New York amount and the federal amount from the two columns on line 31 to calculate the income percentage.