[VA, NYC] How to files multi state tax

[zz26]

Lived in VA (1/2022-3/2022) and relocated to NYC in (3/2022). Same employer. I only traveled back to VA in 11/2022 for business trip and my employer withheld VA taxes when I visited.

1. For the VA portion, I get to the "Part-Year Allocation" portion. Wages, salaries, tips, etc,I see my W2 Box 1 populated but for VA what am I supposed to fill here? Do I fill W2 Box 16 VA, or do I do (2months/12months) * W2 Box1?

2. For the NY portion: Tell us about your New York resident income: How much of the W2Box1 did you earn while living in New York? Do I fill W2 Box 16 VA, or do I do (2months/12months) * W2 Box1?

3. For the NY portion: Tell us about your New York nonresident income: Nonresident income on $XXX. How much of the $XXX did you receive from New York Sources while living outside of New York? Is this $0 because I'm not a non resident of NY/NYC?

[MaryK4]

1.For the Virginia portion, you can use the W-2 Box 16 amount.  

2. For the New York income, you will have to calculate the percentage of time in New York and apply it to the total income (10/12)

3. For the New York nonresident income, it is zero because you did not work in New York while still a resident of Virginia.

[zz26]

Thank you. Is there a reason why for Question #2, It is wrong to just subtract Federal Box 1 from Virginia W2 Box 16 to determine New York Income if it is the same employer?

[MaryK4]

No, actually your method is much simpler and correct.  @zz26 

[zz26]

Thank you. When I take a look at my W2 box 1 and attempt to do a % allocation method, It is different than my W2 box 16 value. Almost off by 10%. Should they be a bit closer?

Also Turbo Tax is suggesting that I am a part year resident for both VA and NY? Is this correct given my move timeframe? When I read the rules for residency I believe I am not understanding why Turbo tax suggests part year over residence for NY?

[MaryK4]

So without seeing the actual numbers, my guess is that the Virginia income include the amount for 1/22 to 3/22 and the 11/22 business trip, so the 11/22 income would be BOTH NY and VA in which case, the percentage method works (which may have been my line of thinking when I answered the question the first time).  You definitely want to file a Part Year return for Virginia and New York.  New York (and Virginia too by chance) have a statutory tax resident based on abode and number of days in the state.  This however, does not apply in the year you enter or leave the state (in most cases).  This is to make the tax filing easier because you have to designate the income as state-source and nonresident etc.- essentially there may be income double-taxed and/or confusion in the application of the credit paid to another state.  @zz26

[zz26]

@MaryK4 Just took a look and indeed the numbers seem to match. The only extra thing was that I noticed my 401k contribution for the year was added to this figure.. so VA W2 Box16 is (1/2022-3/2022 comp) + 11/22 business trip + 401k contribution. I noticed my Federal Box 1 and NY W2 Box16 does not include the 401k contribution I made. Do I need to make adjustments to my VA State return (VA W2 Box 16 - 401k? ) and NY State allocations (FED box 1 - VA W2 Box16 - 401k?)  Or should I keep the 401k stuff in there?

[MaryK4]

That actually is highly irregular- Virginia does not add 401k contributions to income so it is strange that they withheld on that amount.  You will want to subtract out the 401k amount so your Virginia wages are in line with the wages reported on the federal tax return.  Also for the New York income, you can use your FED box 1 - VA W2 Box16 - 401k BUT you must also add the 11/22 Virginia income.  Because you were a New York resident when you received it, you must include it as income to both states- if I did not mention before, you will get a credit for the taxes paid to Virginia on the 11/22 income ONLY.  @zz26

[zz26]

@MaryK4 I retract the statement about 401k being added. When you had mentioned it was odd I went back and took a look at every paystub and noticed when I got paid my annual bonus, VA state taxes were withheld. When I divided the amount taken from VA from the bonus by .0575, I got the numbers to match up pretty closely +/- few $100. I guess my 401k contribution and bonus was similar. Is it normal for portions of my annual bonus to be paid out to VA and NYC? 

Also when I get to the end of wrapping up NY state taxes, I get an error because it is saying that NYC Locality Box 18 is greater than NYS Allocated (Box 1 - VA Box16)? (T-360.1 TP: Line 1b is greater than the amount of Wage income allocated to New York State on IT-203. Edit amounts on the Part-Year Resident/Nonresident Allocation Worksheet or City Wage/Self-Employment Income Allocation Worksheet as needed.)