Taxed by Employer Incorrectly

[Jholker14]

My wife lives and works in California 98% of the time with limited travel for events. Her employer takes out both CA and Virginia income taxes from her paycheck. Isn’t this incorrect? Shouldn’t she only have CA income taxes taken out and how would she get the money back at the end of the year? 

[rjs]

How did Virginia come into the picture? If your wife worked in Virginia, even for just a few days, she has to pay Virginia tax on the money that she earned for working in Virginia. The employer is correct to withhold Virginia tax for those days, and your wife has to file a Virginia nonresident tax return in addition to her California resident tax return.

[Jholker14]

Her employer is located in VA but she does not work there at all. 

[Mike9241 · Accepted solution]

your wife needs to speak to her HR department. They are probably in error in withholding Va taxes.  two possible ways to get it back. the employer can possibly get a refund from VA and then refund your wife or your wife will have to file a nonresident return for VA.

[Hal_Al]

She should ask her employer for an explanation of the VA withholding. As others have explained , that's not right.

As to the 2% of the time, she works outside CA, see: http://money.cnn.com/2013/06/28/pf/taxes/business-traveler-tax-threat/

[TomD8]

If your wife neither lives in nor physically works in VA, she should submit VA Form VA-4 to her employer, checking Box 3.  Here's a link to the form:

https://www.tax.virginia.gov/sites/default/files/taxforms/withholding/any/va-4-any.pdf