Question

MA state tax double counting income

Forum|Forum|6 years ago
March 29, 2020
3 replies
0 views

I had W2s from MA and RI since I live in MA and work in RI most of the year. These each show an amount in box 16 for State wages. When going through TurboTax the RI process goes smoothly and uses the correct box 16 amount. When going through the MA process, the amounts in Box 16 from both W2s are added together in determining the total MA income. I believe the Box 16 from only the MA W2 should be used for this calculation? Is there any way to manually change this?

TurboTax Premier Online

K

KarenM90

If you are saying the one W2 showed MA wages in box 16 and the other W2 was from a different employer and showed Wages in Box 16 for the amounts earned only in RI, then what you are seeing is correct.

All of your income from all states/sources will be taxable in the state in which you are a resident. (Your MA, as well as RI wages, are taxable in MA.)

Only your RI wages (or a calculation based on the percent of total wages they represent) will be taxable in RI.

TurboTax recommends that you prepare your RI tax return first, then your MA return, as the MA return will calculate a credit for taxes paid to RI.

**Say "Thanks" by clicking the thumb icon in a post**Mark the post that answers your question by clicking on "Mark as Best Answer"

D

dngraham37

I have a similar question regarding Massachusetts and double counting. I worked for one company, but some of the work was done in MA and the rest was in DE.

On my W2 I have two state copies, one for MA and one for DE. The one for MA shows my total earnings as reported on my federal return, and the DE one shows just what I earned in DE.

In TurboTax, these are listed as a single W2 with multiple entries for lines 15-18. When I file my MA return the software is combining the MA and DE totals to a total larger than my entire earnings, and calculating my tax on that number.

It seems that it should be calculating tax on my federal earnings for MA, and then subtracting what I worked in DE.

JohnB5677

If you live in MA, 100% of your income is taxed in MA. Down on line 30 you will see Income tax due to another state or jurisdiction. This is where the adjustment is made for taxes paid to another state.

**Say "Thanks" by clicking the thumb icon in a post**Mark the post that answers your question by clicking on "Mark as Best Answer"

D

dngraham37

Thanks - but my question is should TurboTax be calculating on 100% or 150% of my total income, assuming 50% of my income is from out of state?

Example: 100K total income on my federal form
MA = 100K

DE = 50K

TurboTax is calculating my MA tax at 150k x 5.05%

F

FrankSTein

Hi @dngraham37 , so using your example you basically just cut the MA down to $50k?

I’m having the same problem but I n my case 100% of the income was earned in RI. So I should zero the income showed in box 16 for MA.
Am I getting this right? Thanks for your help.

AmyC

Your resident state taxes all income but gives a credit for income taxed by another state. MA will automatically add all W2 state money together to be taxed. The employers have already sent the states a copy of your w2 information. The states know what you have earned. The program is where you correct the w2 information to reflect your situation.

If all of your income was earned in RI, only enter RI and income on the W2 screen.

If part was MA and part RI, enter both states and the amount earned in each state. Your w2 state section in the program does not have to match your w2. It should match real life.

Please carefully follow these directions.

You will need to prepare the states in a special order. You may need to delete both states and begin again.

First, prepare your non-resident return. This creates your tax liability for the non-resident state. How do I file a nonresident state return?
THEN prepare your resident state return and it will generate a credit for your income already being taxed in the non-resident state.
The credit will be the lower of the state tax liabilities on the same income. You may owe your resident state.

It isn't possible for the program to create a credit before it knows the liability. Your returns may be wrong if you do not prepare the states in this order.

If either state questions you, show them the other state return and that all income was taxed. Most states talk to each other over these situations so you probably won't have any communication.

**Say "Thanks" by clicking the thumb icon in a post**Mark the post that answers your question by clicking on "Mark as Best Answer"