I live in one city and work in a different city

[T6Commish]

I live in Dayton and work in Kettering. For some reason in the last couple of years my employer changed my withholding and is paying it to Kettering, the city I work in. Always before they paid it to Dayton, the city I live in. Dayton allows a credit for taxes paid to other cities, but only for 2.25%, which is Kettering's tax, Dayton's is 2.5%. But Kettering withheld more than 2.25%. I had to file a return for a refund of the amount over 2.25% with Kettering and pay the excess to Dayton. I am assuming I have to claim the refund from Kettering as income but where do I claim the amount paid to Dayton so I am not taxed on it twice?

[AlanT222]

You only have to claim the refund as income if you itemized your deductions (did not take the standard deduction).  Also, the local tax deduction is only deductible if you itemize your deductions.