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State tax paid in 2 states on same income (non resident in both states, live in 3rd state), TURBOTAX does not account for this.

I moved from NY to another state (not CT) in 2022.

Prior to moving I worked in CT and lived in NY. As resident of NY, my W2 showed state tax withheld in CT & NY and then NY used to give resident credit on tax paid on same income in CT.  Thus minimizing dual taxation on same income.

 

ISSUE: However, my deferred comp. for year 2023 again withheld tax for both CT and NY (according to employer this is correct as income was earned when I worked in CT and lived in NY, so they are not ready to correct it).

TURBOTAX (desktop 2023) does not allow me to get any refund for NY for the double taxation of same deferred income. Looks like double taxation, is there any way to fix this in TURBOTAX.

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1 Reply
AmyC
Expert Alumni

State tax paid in 2 states on same income (non resident in both states, live in 3rd state), TURBOTAX does not account for this.

Deferred compensation can be taxable to the state where it is earned. As a full year resident of CT, you should have credit for tax paid to NY. The way the income is entered has to be the issue. 

 

Instead, enter only the NY income on the tax form so that CT will realize the credit. Then you can enter the NY tax paid under other income taxes in the federal deductions section. Follow these steps:

  1. Open your return to the federal deductions section
  2. Scroll down to Estimates and Others Taxes Paid
  3. Select Other Income Tax
  4. Select yes to withholding not entered
  5. Select NY
  6. Enter the amount

 

 

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