I have a client who lives and works in California, but the division of the company that employs him is based in New York. He receives a W-2 showing approximately $200K of federal earnings, then $200K of California and $200K of New York earnings (so the two state amounts together are double the federal amount). When I prepare his tax returns, the full $200K is taxed by New York on his NY non-resident tax return, then he receives a credit on his California return for the tax paid to New York. Does that seem correct that the majority of his state tax gets paid to New York when he is a California resident and lives and worked in California?
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"then he receives a credit on his California return for the tax paid to New York."
Thats how it usually works, the resident state gives credit for taxes paid to the non-resident state. (there are a few reverse credit state relationships but CA/NY isnt one of them)
"then he receives a credit on his California return for the tax paid to New York."
Thats how it usually works, the resident state gives credit for taxes paid to the non-resident state. (there are a few reverse credit state relationships but CA/NY isnt one of them)
Thank you for the quick reply.
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