Turbotax California State Wage

[lcbd442]

So we have two W2s uploaded in Turbotax Premier. We were both part-year CA tax resident. In the State tax return section, it asks of all the xxx income, how much is CA state wage.

1. Why does it ask this question? Shouldn't this number just be the w2 CA state wage numbers added together?

2. Now our W2s have mistakes when calculating CA state wage (w2 box 16). Do we input our actual CA state wage in the State tax return section? We are not concerned about CA state withholding here, just the CA state wage because the wage determines the actual CA income tax.

[MonikaK1]

Enter your W-2s and other information returns (1099s, etc.) in the Federal section. Then, in the California state section, if you are a part-year resident, TurboTax asks questions to determine the amount of wages and other income that should be taxed as California income. Depending on your situation, it may or may not be the same amount as the amount shown as California wages or other income on your forms.

As a part-year resident, you pay tax on all worldwide income while you were a resident of California.

As a nonresident, you pay tax on your taxable income from California sources.

Sourced income includes, but is not limited to:

• Services performed in California
• Rent from real property located in California
• The sale or transfer of real California property
• Income from a California business, trade or profession

If you are a nonresident or a part-year resident, you determine your California tax by multiplying your California taxable income by an effective tax rate. The effective tax rate is the California tax on all income as if you were a California resident for the current taxable year and for all prior taxable years for any carryover items, deferred income, suspended losses, or suspended deductions, divided by that income. Use the following formula: Prorated tax = CA taxable income × Tax on total taxable income ÷ Total taxable income

See California FTB Pub 1100 for more information.

[TomD8]

@lcbd442 -

A common reason for the state wages to be incorrect on a W-2 occurs when an employee moves to a different state but keeps the same employer.  That's because there's often a lag between the employee's actual move and the employer's payroll department updating the state withholding.  This is just one example of why the W-2 may not be accurate. 

[lcbd442]

Right, in this case (w2 only the state wage not correct), do I need to request w2c and file amendment, or do I just need to input the right state wage in turbotax?

[TomD8]

As @MonikaK1 explained, you input the correct amount into TurboTax.  You want to pay tax on the correct amount, not on an amount that is higher or lower than that.

You don't request a W-2c.  Your original W-2 is correct in that it shows the actual amount of tax that was withheld by your employer and already deposited with the state.