I paid the wrong state taxes for the last nine months of 2018. Do I need to fill out a Nonresident state tax return?

[pklanning]

I lived and worked in Illinois for the first three months of 2018. I then moved to Indiana and worked at a new employer for the final nine months. However, my new employer set up my state withholdings for Illinois instead of Indiana, and so I have been paying Illinois taxes. Box 15 on my W2 says IL. Do I need to get a revised W2 from my employer? Do I need to fill out a Nonresident state tax return? What should I do?

[CynthiaR · Accepted solution]

Make sure you inform your new employer to start deducting Indiana state withholdings right away.  Otherwise you'll have this problem again next year.

Now for this year you need to file a part year Illinois tax return for those three months in 2018.   Then file a part year Indiana tax return for the last 9 months of 2018.   Both forms will allocate your income to the proper allocation by states. You may have to pay on Indiana tax return since there were no Indiana state taxes withheld from your pay.  But you should expect to get a refund on Illinois for Illinois state taxes withheld all year.

[pklanning]

Thank you for the quick response! So I do not need to have my W2 revised by my employer?

[CynthiaR]

No you do not need to have your W2 revised by your employer.  Just change your state for state withholdings.

[pklanning]

Thanks!