Tax credit from another state

[xuedongzhu]

My daughter went to college in Massachusetts and did a co-op there during 2020.  I do not find an option to get the tax credit from non-resident filing MA when she files the resident tax in AZ.  As a result, she has to pay state taxes in both states.   Is there anything I can do to get her the tax credit? Thanks, Douglas 

[BillM223]

Taxes paid to another state or country are reported on Arizona form 309, Part 2, line 17. This flows to AZ form 301, Part 1, line 3. That flows to AZ form 140, line 51. Do you see any of this?

Did you enter the MA return first, the the AZ return? That's how AZ knows what the out-of-state credit is.

[xuedongzhu]

Thank you for your reply.  It is blank on Line 51 Form 140.  There is no Form 301 nor Form 309.  I am using TurboTax Home & Business. 

I did try to do the MA non-resident tax first after I read a post.  However, that did not make any difference. The AZ form was created automatically after I did the federal form 1040, since I  imported the information from 2019 return (wage from AZ only).  I could not delete AZ return.  Otherwise, I will try to create a new tax return without importing 2019 information.

Please advise.

Thank you.

[BillM223 · Accepted solution]

In the Arizona interview, do you remember seeing a screen titled "Taxes Paid to Another State or Country"?

Answer "Yes".

The next screen should be "Other State Taxes Summary". You should see Massachusetts here if you have already done the MA return. Click on Edit.

There follows a number of screens to verify your MA wages and tax and to verify that this income is taxed by both MA and AZ (as I imagine it is). Note that the credit is not the amount of tax paid to MA, but is prorated in Part 2 of AZ form 309. So complete that section above to trigger form 309 (and 301). 

[xuedongzhu]

Thank you.  You answered my question.