Residences for Internship in 2021

Forum|Forum|4 years ago
January 26, 2022
6 replies
25 views

Hi,

During the year 2021 I was

A graduate student in the state of Illinois in the Spring 2021 semester from the dates January 1 to May 10.
An intern in the state of Wisconsin from the dates May 10 to August 21.
Back to being a graduate student in the state of Illinois for the Fall of 2021 from the dates of August 21 to December 31.

I had a temporary residence in Wisconsin for the dates of that internship and lived in Illinois during the dates I was a student. My W-2 from my Wisconsin employer lists my new Wisconsin address (I have moved in early January 2022 to Wisconsin) but I believe my employer had my Chicago address during my internship because I paid Illinois income taxes and Wisconsin income taxes during my internship according to my payslips. My Wisconsin employer's W-2 even lists Illinois in box 15. When trying to file my taxes on turbotax the questions about my residency in wisconsin have been quite strange. Things like "why didn't you buy a car or a home in wisconsin/illinois" and it doesn't seem to understand that I was only temporarily living in wisconsin as it will asks things like "when did you move out of wisconsin" when I both moved into WI and out of WI in 2021. Is my Wisconsin employer's W-2 correct to list IL in Box 15 and how do I answer these questions correctly on the online tax filing app?

RobertB4444

Level 15

Multiple state tax returns can be tricky. You need to do the Wisconsin return first. If you already did the Illinois return then you should delete it and delete the Wisconsin return you've started and start over by doing Wisconsin first. You should be registered as a part-year resident of Wisconsin and a resident of Illinois. Illinois will give you a deduction for taxes paid to Wisconsin while you were there being an intern but you have to do Wisconsin first to make sure Illinois gives you that deduction.

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gudetama17Author

Level 2

Thanks so much for the reply! One question: I am then prompted with the question asking which of the following best describes my residency in WI:

resident of WI all year

changed legal residence from WI in 2021 and have not moved back to WI

changed legal residence from WI during or before 2021 and did move back to WI

changed legal residence in 2021 to WI and wasn't a resident of WI any previous year

nonresident of WI for all of 2021.

At least in 2021, none of these seem to apply. I have moved in January of 2022 back to WI but for the earnings I made in 2021 I was a graduate student in Illinois for the rest of 2021 after moving back. Which one would be best to select?

Thanks in advance!

MarilynG

Level 15

Choose 'changed legal residence in 2021 to WI and wasn't a resident of WI any previous year'.

It's interesting that Wisconsin is asking so many questions! Most states simply ask for the dates you moved in/out of the state. Do the best you can answering these; the net out being that you were a part-year resident for four months (and a part-year resident of IL for 8 months).

To figure state taxes owed, many states take your total income from your Federal return and calculate a % of it as being earned in that state, based on the number of months you lived there.

However, other states ask you to split out your income between their state and the 'other state' (this info hopefully being on your W-2 so no calculations are required by you), so don't despair if the calculations on the state returns seem odd.

It's also interesting that your employer withheld both Illinois and Wisconsin tax on your pay, since they are 'reciprocal states'. Enter your W-2 as it is shown, and the state returns in TurboTax will sort it out.

Click this link for more info if you're interested.

Don't worry about the address on your W-2; the current address for a taxpayer may not be in any of the states they worked in! The IRS only needs to know where you are now.

This link has more info on preparing a Part-Year Resident Return.

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