Same employer and EIN W2, two states, one state non resident, second state nonresident, how to fill out W2 section

[hellotax1111]

Hello, 

I have a W2 with two states for one employer (same EIN for both states). First state is IL, where I was a nonresident for all 2021 and the second state is NC where I was a resident for all 2021. This is because I hadn't told my employer my correct address right away. 

I read a thread that said to add additional rows for different states. However, when I do this, I get a SMART check error saying that there are "Duplicate entry for box 12."

1. For my situation, can I confirm how I should submit the W2 section? I have added NC and IL separately and put NC first. Is this correct?

Or should sum up the taxes and wages for both states and put in one line? Or should I be doing something completely different?

2. If I use the additional rows for each state, do I bypass the SMART check error and will I be able to submit my return or will it be blocked?

Thanks!

ttlc.intuit.com/community/taxes/discussion/i-have-a-w2-with-multiple-states-on-one-w2-how-do-i-properly-enter-in-turbotax/01/279001#M118403

ttlc.intuit.com/community/state-taxes/discussion/i-received-w2s-for-2-different-states-from-the-same-employer-because-there-was-a-delay-in-updating/01/118339#M3826

[AnnetteB6]

You would enter the state information just as it is reported on your W-2 with two separate lines of data, one for IL and one for NC.  This should not cause any errors since it is the proper way to report the situation when two states are on one W-2.

According to the error message you shared, a duplicate entry in box 12 is being flagged.  Box 12 is not related to the states at all.  Double-check your box 12 information and be sure it has been entered accurately.  Also double-check the error message you are seeing to be sure which section is being flagged.

[hellotax1111]

Hi Annette, 

Thanks for your quick reply! 

I did double check the error message and it does indeed say "Duplicate entry for box 12," which as I stated before was done intentionally. This is because I have three rows for NC (C, AA, D) and three rows for IL (C, AA, D). I also double checked the numbers and they were indeed correct. Again, I have one W-2 for the same employer (same EIN) with two states. 

You mentioned that box 12 does not have anything to do with the states. Even if the state (NC, IL) is not specifically chosen in this section, the information in this section differs for each state. That is the whole reason I have duplicate "C" "AA" and "D" rows in this section, one for NC and one for IL. 

So my Box 12 is as follows:

NC (resident)

C

AA

DD

IL (nonresident)

C

AA

DD

Again, my questions are:

1. Given my situation, have I entered the info in the correct format, correct way?

2. If so, why is there a SMART Check error?

3. Will I be able to submit my tax return despite this error?

Thanks again for your help!

Note: Correction of the original post subject title : Same employer (and same EIN) two states, one state (IL) non resident, second state (NC) resident. 

[AnnetteB6]

The situation you describe does not sound normal in my experience.  

When you have worked for the same company and you have received one W-2 with multiple states being reported on that W-2, the only lines or boxes that should be different would be the ones associated specifically with state information.  That would be boxes 15 through 17 and maybe 18 through 20 if locality information is reported.

Box 12 should not be broken down by each state.  Therefore, there should not be duplicate information in box 12.  That is the reason for the error message you are seeing.  You have only entered information as it was given to you.

Take a look at your W-2 again and see if there is a Federal copy of the W-2 that shows only one of each entry in box 12.  It may be reporting a combined total from the states.  If so, use that information to fill in box 12 in TurboTax.  

If there is not a combined total for the box 12 codes, add each one together and report a combined total instead of entering one for each state.  The information reported under codes C, AA, and DD is informational and does not affect your tax return directly.  

@hellotax1111

[hellotax1111]

I see. Thanks for clarifying Annette!

Yes, there is a Federal W2 section with combined box 12 for both states. It states it is for "TOTAL STATE."  I will enter the combined value on the federal W2 for NC and IL in box 12 instead of separating rows for for NC and IL. Also, good to know it is for informational purposes only thank you for mentioning that. Now I don't have a SMART check error. 

1. By the way can I confirm that for Box 15-17, since I have a resident state (NC) and nonresident state (IL) I should enter the resident state first. The order does matter in this section correct?

2. For future reference, just so I know, will I be able to still submit the Tax return or will Turbo Tax prevent me from submitting?

3. Separately, when I completed the IL nonresident tax form, and then look at the section in the NC tax return for "Taxes to Other States" in the "Credits and Taxes" section of the NC return, the amount that TurboTax written for "Tax paid to Illinois" was about $10 less than what I had written in Box 17. So I wrote down the correct amount in the "Amount if Different" column. Would you know why the number TurboTax inputted in the "Amount" would be different from Box 17 at all? How come the amount wouldn't be a straight input from Box 17?

By the way, only Box 17 differed (for taxes paid to IL in this section(. The amount for Box 15 for Income Earned in Illinois and subject to NC states was correct and matched the original Box 15 amount I had inputted from Box 15 of the W-2 Section. 

Thank you!

[AnnetteB6]

That is good news that the error check went away.  Since the Smart check error is gone, there should be nothing to prevent you from filing normally.

It does not matter what order you enter the state information on the W-2.  It matters what order you prepare your state tax returns.  You should work on the non-resident return first and then your resident return.

When you are going through the NC resident return section for taxes paid to another state, TurboTax is looking at the actual tax return for the non-resident state, not the state taxes that were withheld on your W-2.  The credit for taxes paid to another state is based on the actual state tax return and not just the withholdings, so you should change that amount back to what TurboTax determined it should be after the IL return was completed.

@hellotax1111

[hellotax1111]

Hi Annette, 

Thanks for the reply!

1. My question for SMART check was not about this situation/year. I was asking for FUTURE, if I ever get another SMART Check error, am I able to continue filing my return or no?

2. To clarify, the amount that I changed was NOT the credit for IL that was calculated. It was the amount for the INPUTS that are used to calculate the credits (the prior page that you encounter or you can press "Edit" besides the credit amount to see it). You should see two orange columns for "Amount" and "Amount if different". In the row, it specifically states "Tax paid to Illinois" and then the amount. It does NOT state "credit for IL" in that prior section. The prior section is called "Income Taxed by Illinois"

Would you please look at the correct page I am referring to and confirm that I should indeed change it to the original W2 amount for IL in Box 17. Because the the taxes paid to Illinois should be what is listed on the W2 Box 17 correct?

Then based on that the credit is calculated on the next page.

[AnnetteB6]

Smart Checks are there to alert you to something that may prevent you from filing your return electronically.  If they are not corrected, you may be required to file by mail.

The taxes paid to Illinois is not necessarily the amount that was reported on your W-2 in box 17.  That is just a number for taxes that were withheld.  The actual Illinois tax return will determine the amount of taxes that must be paid to Illinois based on your income and deductions.  Then that amount is compared to the amount of taxes withheld to decide if you owe more money or get a refund.  

If TurboTax determined a different amount of taxes paid to Illinois, it is getting that number from the Illinois return and it is not supposed to be the amount reported on your W-2 in box 17.  If it were that amount, it would be a coincidence.  You should allow TurboTax to fill in the correct value and not change it to match your W-2 box 17 amount.

@hellotax1111

[hellotax1111]

Thanks Annette for the thorough explanation! Appreciate all your help.