I live in PA and gambled in MS. MS withheld State taxes however they do not require a nonresident return to be filed. Can I still complete the G/L for PA to receive credit for taxes paid to another state? Also if I can am I able to claim the credit if my gambling winnings are offset to zero with losses from PA gambling? Thank you!
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You need to file a non-resident MS return. Withholding is not tax paid, it is an estimate. If you don't file and just like MS keep the withholding, you can't claim that as tax paid to another state on your PA return. You need to file the MS non-resident return, calculate your actual tax, get a refund (if owed) and then you can claim whatever MS keeps as taxes paid.
MS doesn't require a nonresident return if only income in MS is from gambling. The W-2g is considered the tax return in MS per MS DOR website.
@strawberryy745 wrote:
MS doesn't require a nonresident return if only income in MS is from gambling. The W-2g is considered the tax return in MS per MS DOR website.
The question is not what does MS require, the question is what PA requires.
As a resident of PA, can I get credit for income taxes paid to another state, which is not reciprocal?
Yes. In order to claim the credit, you must submit a copy of the other state's tax return, a completed PA Schedule G-L, and a copy of the W-2 showing the other state's withholding, with your PA return when it is filed.
Will PA consider the W-2G to be both the W-2 proving withholding and the tax return proving tax paid? I don't know. And you can't e-file with the W-2G because you can't attach outside documents in Turbotax. PA might accept an electronic copy of the W-2G, but they might require you to mail in a paper copy.
I also don't know how you can use Turbotax -- the program is designed to automatically allow a state credit if you prepare a non-resident return in the program, but if you don't prepare a MS non-resident return in Turbotax, the only way to enter the correct forms would be to use the desktop program installed on your own computer and enter everything manually. That's a lot of work for something that would be automatic if you prepared the MS return.
On your PA tax return, you list all your worldwide winnings and all your world-wide losses on schedule T. That goes into the calculation of overall taxes you owe. Then any out of state credit is calculated schedule G-L.
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