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Problems with W2 form and state income tax

I finished my tax return for 2023 for Federal and California.  I went through the process of e-filing for both Federal and CA. I paid $20 for the CA efiling and at the moment, when I was ready to click submit, I received an error alert from the program saying that I could not efile because, in one of my W2 forms, the state income tax withheld  was higher than 50% of my wages listed in that W2 form (it exceeded the 50% of the wages amount by$111).  The program told me that, if I did not make a correction in the amount of the  state income tax withheld, I would have to file by mail.  

 I prefer  efiling.  Is there a solution for this issue? it is the first time that this happens to me.

Could I reduce the amount in the W2 by $111 so that I would be less than %50 of the wages amount in the form?  Could that create a problem for my return? Could it trigger an audit?

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1 Best answer

Accepted Solutions
Cynthiad66
Employee Tax Expert

Problems with W2 form and state income tax

No, it will, most likely, not affect the Federal.  If the amount does not affect the Federal then there is no problem.  The amount is very small and most likely, would not set off any alarms.   @gonzalon 

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4 Replies
DavidD66
Employee Tax Expert

Problems with W2 form and state income tax

Theoretically you could reduce the amount of state tax withholding by $111 so you could e-file your returns.  I am not going to suggest that you should intentionally file an incorrect return.  If you do reduce the amount and e-file, it won't match the state's records.  More than likely they will treat it as a "math error" and an adjustment to your return will be proposed and mailed to you.  The process is automated.  If you agree with their change, then you won't need to do anything.  Or you could print and mail an accurate return.  small data entry and math errors don't trigger audits. 

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Problems with W2 form and state income tax

Thank you very much for the information you gave about problems with my W2 form.

I have a follow-up question:

If I lower my state income tax amount in my W2 form  by $111 dollars, the amount of my refund for my CA return is lowered by $123, but the refund for my federal return is unchanged. 

Will the change in my state income tax amount affect in any way my federal return? Will it trigger the attention of the IRS?

Thank you very much again

Cynthiad66
Employee Tax Expert

Problems with W2 form and state income tax

No, it will, most likely, not affect the Federal.  If the amount does not affect the Federal then there is no problem.  The amount is very small and most likely, would not set off any alarms.   @gonzalon 

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**Mark the post that answers your question by clicking on "Mark as Best Answer"

Problems with W2 form and state income tax

Thank you very much for the precise information you have provided mel

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