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    PA non-resident question

    I have a client who moved to NY from PA in 2010. She was a full year NY resident in 2011. She received a W2 for severence pay from a company she worked for while living in PA, which lists PA as the state and has PA withholding. I am preparing a non-resident PA return for her, but am unsure as to whether this income is truly taxable to PA, or if I should just file to get a refund of withholding. Any advice would be appreciated.

    #2
    Does your software

    Originally posted by Barb132130 View Post
    I have a client who moved to NY from PA in 2010. She was a full year NY resident in 2011. She received a W2 for severence pay from a company she worked for while living in PA, which lists PA as the state and has PA withholding. I am preparing a non-resident PA return for her, but am unsure as to whether this income is truly taxable to PA, or if I should just file to get a refund of withholding. Any advice would be appreciated.
    not separate the two states? PA will only tax PA income. NY will probably tax it all and allow a credit for PA taxes paid-if there are any.

    Peachie

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      #3
      Originally posted by Barb132130 View Post
      I have a client who moved to NY from PA in 2010. She was a full year NY resident in 2011. She received a W2 for severence pay from a company she worked for while living in PA, which lists PA as the state and has PA withholding. I am preparing a non-resident PA return for her, but am unsure as to whether this income is truly taxable to PA, or if I should just file to get a refund of withholding. Any advice would be appreciated.
      When she worked for them, was the work done in PA? If so, I believe PA considers it PA source income, even though paid after leaving employment.

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        #4
        severance taxable

        From PA DOR FAQs page:

        Is my severance pay taxable even if I moved to a different state?

        Severance payments received from services that were performed in PA would be taxable to PA even if you are no longer a PA resident with the exception if you move to a reciprocal state.

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