State Tax

[Brian EA]

Taxpayer is a resident of GA and worked 6 months in CA. The W2 correctly reported the Federal income of 10K, and 10K of CA income, however the company also reported 10K in GA income. State taxes were withheld from the CA income but not on the GA income.
Is there a way of offsetting the GA income? The company says that they cannot change it.
Any suggestions?
Thanks
Brian.

[Rapid Robert]

I assume you are talking about Box 15 on the W-2. Georgia starts with federal AGI, so the $10K is already included in Georgia AGI. I don't understand the problem. What entry are you making that adds a duplicate $10K to GA income? (Georgia most likely taxes residents on worldwide income, like most states).

Now, you will have double taxed state income (CA and GA), and will need to use GA other state tax credit (OSTC) to remove the double taxation.

[Brian EA]

One W2 has the Federal Income with CA information in box 15. The other W2 has only GA income in box 15 and it is the same amount as the CA income.
I guess I will have figure out a way to remove the double taxation.

[Rapid Robert]

You didn't mention two W-2s. So the 2nd W-2 has no entries in Box 1/3/5? If so, I would just ignore it. Again, Georgia starts with federal AGI, so what is in Box 15 and following only matters for state withholding purposes, which you said there was none for GA. (Georgia conforms to federal, so unlike CA, for example, there is no add-back for HSA deductions).

I don't understand what you mean by "remove" the double taxation. You have double taxation, that is a fact.. The OSTC is the method used to offset that, so what is it you have to "figure out"? Your software should handle OSTC.

What entry are you making that adds a duplicate $10K to GA income?

[BOB W]

Don't add 2 federal incomes of $10,000, just one, but add CA and GA $10,000 on separate state lines and let the calculations finish the return