Worked remotely for same employer but moved from IL to NC. W2 lists only one address. Do I file for both states?

[lauramariefu]

I worked for the same employer in 2016 but during that time I moved from IL to NC. I kept the same job. My W2 from them lists my current (NC) address but has no mention of the 8 months (Jan - Aug 2016) that I had that job and lived in IL.

Am I to file this W2 under my NC address? Or do I need to file in both IL and NC?

[DanielV01 · Accepted solution]

Yes, you will file part-year resident returns for both IL and NC.  Your W-2 will show the current address your company has on file for where the W-2 was sent to get to you.  Also, your income is not broken down by months, but rather into yearly totals.  However, your Illinois income should be listed in boxes 15-17.  You should see one line that says IL and another line that says NC.

Nevertheless, if your W-2 only has one state mentioned, and the amount in box 16 matches the amount in box 1, you are still required to file in both states.  In this case you would allocate your income on your part-year returns.  You would determine the percentage of the income you earned while living in Illinois (roughly 66%) and multiply that by your total income.  If no IL tax was taken out (only NC tax), you leave the Illinois tax withheld at zero, which means you will have an amount of tax due.  However, when you file the NC return, you will have paid a full-year's worth of tax on only 33% of the income, so the refund there should make up for most of the difference.

Those are "just-in-case" instructions.  It will be highly unlikely that your IL income is not reported, especially since you were living in IL at the beginning of the year, before deciding to move to NC.  Your company would have been withholding IL tax at that time.

[lauramariefu]

Thank you! In following up with my ex-employer, they confirmed that they gave me a W-2 that only reported income to IL. So the mailing address is my current NC but only IL was reported for wages that were Jan-Aug in IL and Sept-Nov in NC.

They refused to correct the W-2 and instructed to fudge my taxes. Since all my state taxes were reported to IL on the W-2, they told me not to list anything in NC. But according to your detailed instructions, if I can do the "just in case" steps, I can just allocate part-year returns. At lease me ex-employer gave me the calculations for my actual wages earned in each state.

Oy, what a headache!

[DanielV01]

They at least gave you that.  Otherwise you would have had to calculate that also.  But it is the correct way.  Hopefully they have completely corrected it for going forward.  You will probably have to mail in both state returns, with a copy of the explanation provided by your company, so that each state is in agreement with the allocation amounts.