Three States, Two Partial Year Residencies

[C3inCA]

I was a California resident going to graduate school in New York (and earning income there) for the first half of the year, and then moved permanently to Massachusetts (and established residency) for the second half of the year.  I filled out a NY nonresident tax form and a MA partial-year resident tax form with no issues.  When I try to claim the credit for income tax paid to NY on the CA income tax form (which was earned while I was a CA resident), I get an error that says "CA nonresidents cannot claim other state tax credit paid to this state." (NY).  Is this a legit error flag (i.e. I can't actually claim credit for the tax paid to NY), or is this an "undocumented feature" in TT?

[TomD8]

The program "thinks" you were a non-resident of CA during the year, which you were not.  This probably has to do with your entries in the Personal Info section.

In that section, you should enter your State of Residence as MA.  You should indicate that you also lived in CA, and enter the date you began living in MA.  And you should indicate that you had "other state income" from NY.

Then in TurboTax you should complete your three state returns in this order: NY, CA, MA.

[C3inCA]

That is the way I entered it (MA resident, former CA resident, income from NY) and that is what produced the error message during the check.  Any other ideas?  It looks like CA uses the same form for nonresidents as it does for partial-year residents.  That may be where the confusion lies.

[KeshaH]

If you'd like, we can look at your return and see exactly what you see to  help come to a resolution. The return will be scrubbed and won't include any of your personal details.

If you're using TurboTax Online:

Once you're logged in to your account,

- on the left hand panel, click on Tax Tools and then choose Tools

- on the pop up window, select Share my file with Agent

- you'll see a message saying you'll give us a copy of your tax return. Your personal information will be changed so we can't see any private information.

- click okay and you'll get another message with a token

If you're using TurboTax Desktop:

• Click on Online in the top menu of TurboTax Desktop for Windows
• Select 'Send Tax File to Agent'
• Write down or send an image of your token number and state then place in this issue.
• We can then review your exact scenario for a solution

Please reply to this message with your token so that we can further assist you. Let us know all the states, if any, that are included on the return.

[C3inCA]

The token number is 9411820808251851-03737585

Hopefully you can see the token number.  If not, let me know and I will break it up into smaller chunks.

[KeshaH · Accepted solution]

Thank you for sending your token.

I've looked over your California return and I do see the credit for the tax paid to New York that's completely eliminating your California tax. Your California return is showing no refund/no balance due.

[C3inCA]

Kesha,

I have looked at the forms and they look like everything is entered correctly on them.  The problem is that I get this error when I run the Smart Check:

[MarilynG1]

Basically, California would want to tax the income earned while a part-year Resident there (which would include your NY income, since you were still a CA resident while you earned it). 

You may want to check your entry for dates lived in CA and that your Filing Status is Part-Year Resident.  

If you're using TurboTax Online, you could delete California, close TurboTax, clear your Cache and Cookies, and step through the CA interview again.  You should get credit for tax paid to NY, since you're reporting your NY income there.

Here's more info on  Allocating Income for a Part-Year Resident.

@C3inCA