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New Member
posted May 9, 2023 11:02:53 AM

Remote worker in Idaho for an Indiana company

I worked the entirety of 2022 from Idaho for an Indiana company. Can anyone help me understand what my tax liability is to each state? Thank you. 

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5 Replies
Level 15
May 9, 2023 11:49:36 AM

If you never worked or lived in Indiana at any time in 2022 and did not have Indiana state income taxes withheld from your wages then you do Not file a 2022 Indiana state income tax return.

 

All of your income is taxable in your resident state of Idaho for tax year 2022.

New Member
May 9, 2023 12:02:03 PM

Thanks @DoninGA. I did have Indiana taxes withheld but never worked or lived there in 2022. My employer did switch my withholdings to Idaho at the start of 2023 though. 

Level 15
May 9, 2023 12:34:41 PM

Then you will need to file a 2022 nonresident Indiana state tax return.  You report 0 income for Indiana so that you will receive a refund for the Indiana state taxes which were withheld.

If you are going to use TurboTax then you complete the nonresident state return before completing the resident Idaho state return.  You still must report all income received on your Idaho tax return.

New Member
May 9, 2023 1:35:18 PM

I actually did that through TurboTax. It completed a IT-40PNR form for me and said I would get the money refunded. But, I just got a letter from the Indiana Department of Revenue letting me know they made some adjustments and no longer will be getting the money refunded. Trying to figure out if I actually owe the tax or if I should get the refund like TurboTax suggested. Here's what the letter stated:

We adjusted line 1 to match the sum of your Indiana column on Schedule A.
We adjusted your Schedule A Indiana Line 1B to match Indiana income reported on the primary customer's W-2s
We adjusted Schedule D's proration percentage to match the calculation on Schedule A Line 21D.
No CT-40 was attached, so we filled it out based on the information included with the return.

Level 15
May 9, 2023 1:50:03 PM

The Indiana notice you received should have a way to contact them to discuss this issue.   

The Indiana nonresident return should have 0 income entered since you did not live or work in Indiana.

 

The Indiana Schedule A Column B should have 0 entered.  That amount flows to IT-40PNR Line 1.

Look at the Schedule A and IT-40PNR that was filed to verify that 0 income was reported.