MD state taxes withheld erroneously. Should I file to correct State CA even though CA is not shown on the W-2?

[lazuras15]

State taxes:  State tax was withheld for both CA and MD.  In 2018, I was a resident state CA and never lived in MD.  Question:  Should I change State wages (box 16 on W-2) to reflex total wages earned in 2018 (box 1 on W-2) for CA? 

[DanielV01 · Accepted solution]

Yes, you will file a CA resident return.  You will not need to adjust anything on the W2, because California taxes all of your income regardless of where you earn it.  

You will also need to file a MD nonresident return to have the mistaken withholdings refunded to you.  To do this, please note the following instructions for the Maryland return:

You will go through a number of screens asking for information such as residency, county you worked in, etc.  You eventually get to a screen that states Here's the income that Maryland handles differently.  At the bottom, click Done with income.  The next screen asks about Maryland Wage Income.  In the box "Wages From Maryland Sources" type in a zero.  You will then get a refund for all Maryland taxes you had withheld