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ududek
Returning Member

Worked as employee 75% of time in residence state & 25% onsite for company. Received severance in January. What state is severance reported as income?

Income 2017 and severance paid in 2018

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Accepted Solutions
MichaelL1
Level 15

Worked as employee 75% of time in residence state & 25% onsite for company. Received severance in January. What state is severance reported as income?

Ok, thank you for letting me know that severance income had employer's resident state taxes withheld.

Then right now you would have to file a non-resident return reporting this income (and taking credit for State taxes withheld).

Then you would file a resident return reporting all the income and taking a credit for taxes paid to then non-resident state (as long as your resident state has state income taxes).

The other option is to: Talk to employer asap and tell them to correct this so only taxes are withheld from the resident state where you reside due to primarily doing work from home. 

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6 Replies
MichaelL1
Level 15

Worked as employee 75% of time in residence state & 25% onsite for company. Received severance in January. What state is severance reported as income?

Is severance on a W-2 and does it show in boxes 15, 16 and 17 the state information?
ududek
Returning Member

Worked as employee 75% of time in residence state & 25% onsite for company. Received severance in January. What state is severance reported as income?

box 17 shows amount of tax withheld
ududek
Returning Member

Worked as employee 75% of time in residence state & 25% onsite for company. Received severance in January. What state is severance reported as income?

15 states total state
MichaelL1
Level 15

Worked as employee 75% of time in residence state & 25% onsite for company. Received severance in January. What state is severance reported as income?

Is that the state you are a resident of?
ududek
Returning Member

Worked as employee 75% of time in residence state & 25% onsite for company. Received severance in January. What state is severance reported as income?

No, the taxes were withheld in the employer's state not the state of my residence.
MichaelL1
Level 15

Worked as employee 75% of time in residence state & 25% onsite for company. Received severance in January. What state is severance reported as income?

Ok, thank you for letting me know that severance income had employer's resident state taxes withheld.

Then right now you would have to file a non-resident return reporting this income (and taking credit for State taxes withheld).

Then you would file a resident return reporting all the income and taking a credit for taxes paid to then non-resident state (as long as your resident state has state income taxes).

The other option is to: Talk to employer asap and tell them to correct this so only taxes are withheld from the resident state where you reside due to primarily doing work from home. 

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