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I worked in one state part of the year for an internship but my W-2 only shows home state.

Hello tax experts,

 

I had an internship last summer in Virginia while my home address is in Indiana. However, my W-2 only lists Indiana as a state I payed taxes too. Every forum I read seems to say I need to fill out a tax form for both states, but I'm not sure what to list as my income for Virginia or Indiana. The W-2 had all my income taxed to my home state, Indiana, but I earned it all in Virginia. So when I fill out a form for Virginia I end up owing $0 and being refunded $0 since as far as my W-2 is concerned I have no association with them. I would really appreciate some clarification on how to proceed.

 

Thanks for the help.

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1 Best answer

Accepted Solutions
MaryK4
Expert Alumni

I worked in one state part of the year for an internship but my W-2 only shows home state.

Thanks for the clarification- because it was through the Army (as a branch of the armed forces), it has special treatment so you do not have to file and pay the state tax for two states- in this case, you do not have to file for Virginia at all.  (It is treated like Active Duty pay). 

@ncfreed

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6 Replies
DavidD66
Employee Tax Expert

I worked in one state part of the year for an internship but my W-2 only shows home state.

Each state section in the TurboTax step-by-step has a page (or pages) where you allocate your income for that state when you are filing multiple state tax returns.  See the screen shot below which shows the Indiana Income Allocation page.

 

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I worked in one state part of the year for an internship but my W-2 only shows home state.

Thanks for the reply David.

 

I think I understand how to input the information, my confusion is I'm not sure to which state my income is attributable. I earned it in Virginia so I would think I should list the income as being taxable to Virginia. However, my W-2 did not have Virginia as a state my taxes went to. It did have Indiana tax my entire income (which was earned in Virginia.) So would I list my full income as attributable to Indiana, Virginia, or both? 

MaryK4
Expert Alumni

I worked in one state part of the year for an internship but my W-2 only shows home state.

If you did the internship in Virginia, normally you would file a nonresident Virginia tax return then include it on Indiana with a credit for the taxes you paid to Virginia.  However, if it was a school program they may have had an agreement with Virginia- who did you do the internship with?

@ncfreed

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I worked in one state part of the year for an internship but my W-2 only shows home state.

Hello Mary,

 

Sorry for the delayed response, I never got a notification on the reply and thought I was still waiting on one. It was an internship with the Army but it wasn't through my school. I tried to do what you are saying where I would get credit for paying taxes to Virginia, but since my W-2 only had me pay income taxes to Indiana, I would have no tax payments to claim paying to Virginia. So I tried doing it the opposite way, where I would claim credit for the taxes payed to Indiana on my Virginia form, but I found out Virginia does not allow credit for taxes to other states on non-resident forms unless its to three specific states. I forget which ones but it did not include Indiana. I honestly would think being that I never lived in Virginia, never payed any income tax to Virginia, and that the state is not listed on my W-2 I would not even need to fill out a tax return but since I did work in the state I also think I need to. This has left me very confused and I appreciate your feedback.

 

My biggest concern with this situation is being taxed for my income twice and having to pay for that now. With a deduction from Virginia for State and Federal employees who earned less than $15000 (which since I worked for the Federal government and worked just a few months I was under that threshold) I am able to deduct my income and pay $0 to Virginia as a result in my tax return. I would then just for all intents and purposed just be taxed to Indiana so in a roundabout way that also solves my problem, but I would still like to know to solve my dilemma with the state tax credits.

 

MaryK4
Expert Alumni

I worked in one state part of the year for an internship but my W-2 only shows home state.

Thanks for the clarification- because it was through the Army (as a branch of the armed forces), it has special treatment so you do not have to file and pay the state tax for two states- in this case, you do not have to file for Virginia at all.  (It is treated like Active Duty pay). 

@ncfreed

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"

I worked in one state part of the year for an internship but my W-2 only shows home state.

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