Incorrect Income Earned While a Nonresident

rookietaxer55
rookietaxer55 Member Posts: 1 Newcomer
in State Filing

I don't think freetax is picking up the correct amount. I work in CT and live in RI. Freetax is picking up the W2 wages box 1 in the "Income Earned While a Nonresident" instead of just the CT wages in box 16 of my W2. This is triggering a larger refund than what I should be getting. I am unable to edit this as well. I even see this message on the screen

"The amount of Connecticut wages shown in Box 16 of your Form W-2(s) is $XX, ****. This is probably the amount to enter as the Connecticut amount of your wages unless your employer didn't put the right amount of Connecticut wages in Box 16 of your Form W-2(s)."

What should I do. My federal is getting calculated correctly.

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Answers

  • MatthewD
    MatthewD FreeTaxUSA Team Posts: 581

    Hello rookietaxes55,

    Please take a moment and check your W-2 and then review the W-2 you entered to confirm the amounts entered. That recommended amount you mentioned comes directly from the data you entered for the W-2. Our software picks up the state code (CT) and the amount from box 16.

    Keep in mind that is the suggested amount. You may enter the correct amount in the "Nonresident Income From Connecticut Sources" column and box on the "How much did you earn in CT?". If you still think there is a problem, please send a message to Support on the Support Center page.

  • AnneB
    AnneB Member Posts: 1 Newcomer

    I'm having the same problem. On the "Nonresident income" page, the correct RI income is suggested and that's what I enter into the RI income field. But then on the summary page, the total federal income between my husband and I is used to calculate my state taxes - resulting in too high taxes owed.

  • rakeshsm91
    rakeshsm91 Member Posts: 1 Newcomer
    https://community.freetaxusa.com/discussion/1964/incorrect-income-earned-while-a-nonresident

    I am seeing the same, Did you get any response from the support regarding this?

  • MatthewD
    MatthewD FreeTaxUSA Team Posts: 581

    So both of you should contact Support so they can look at your account. What some states do is use all your income to calculate your marginal tax rates. Then they prorate your taxes based on the % of income earned in their state. It allows them to collect the maximum taxes from you.

    Basically, those states are taxing you at the highest marginal rate.

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