Do I file for a credit on my state tax return for unemployment received from another state (taxes withheld)?

[oxpark]

I lived and worked in Illinois when I lost my job. I filed for unemployment and had taxes withheld for state and federal income tax. I moved to North Carolina a month later and continued to receive unemployment from the state of Illinois for the rest of the year.

Do I need to file for a credit on my North Carolina state return since Illinois withheld state taxes? If so, do I only file for a credit on the amount Illinois taxed me while I lived in North Carolina?

[CynthiaR · Accepted solution]

You would file a part year Illinois resident and part year North Carolina resident tax return.  Be sure to put down the day you moved from Illinois to North Carolina on both state returns.  Illinois will allocate your Illinois wages and unemployment insurance and allocate deductions for the number of months you resided in Illinois.  You would then claim the Illinois taxes withheld to come up with your Illinois refund or balance due.  With North Carolina you would report your North Carolina income and it should allocate the amount of deductions you are entitled to based on the number of months you lived in North Carolina.

[oxpark]

Great - thank you for the clarification!