18 June 2022 12:00

MA 2015 Schedule Z line 12: “Income tax paid to another state or jurisdiction (from worksheet)” -> what worksheet are they talking about?

Does Massachusetts give credit for taxes paid to other states?

Massachusetts residents are allowed a credit against the Massachusetts personal income tax “for taxes due any other state, territory or possession of the United States, or the Dominion of Canada or any of its provinces on account of any item of Massachusetts gross income….” G.L.

Does Ma have a pass through entity tax?

Introduction. On September 30, 2021, the Massachusetts Legislature enacted an elective pass-through entity (PTE) excise in response to the $10,000 cap on the federal state and local tax (SALT) deduction added in the 2017 federal Tax Cuts and Jobs Act.

Is Cancellation of Debt taxable in Massachusetts?

Mortgage Debt Forgiveness results in taxable cancellation of debt income in Massachusetts but such income is excluded from federal taxable income if the debt is forgiven on or before January 1, 2021.

Can I be taxed on the same income in two states?

Federal law prevents two states from being able to tax the same income. If the states do not have reciprocity, then you’ll typically get a credit for the taxes withheld by your work state.

Do I have to pay NY state income tax if I live in another state?

You are subject to New York State tax on income you received from New York sources while you were a nonresident and all income you received while you were a New York State resident. You may have to pay income tax as a resident even if you are not considered a resident for other purposes.

Which states have pass-through entity tax?

These include Alabama, Arizona, Arkansas, California, Colorado, Connecticut, Georgia, Idaho, Illinois, Louisiana, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, New York, North Carolina, Oklahoma, Oregon, Rhode Island, South Carolina, and Wisconsin.

What is Massachusetts pass-through entity withholding?

Pass-through entities are required to withhold an amount that is calculated based on Massachusetts taxable amounts of distributive share allocated to a member subject to withholding. The amount subject to withholding is calculated based on the entity’s Massachusetts-source income.

What is pass-through ownership?

What Is a Pass-through Business? A pass-through business is a sole proprietorship, partnership, or S corporation that is not subject to the corporate income tax; instead, this business reports its income on the individual income tax returns of the owners and is taxed at individual income tax rates.

How do you do taxes if you live and work in 2 different states?

If the state you work in does not have a reciprocal agreement with your home state, you’ll have to file a resident tax return and a nonresident tax return. On your resident tax return (for your home state), you list all sources of income, including that which you earned out-of-state.

How do I file my taxes if I lived in 2 different states?

If You Lived in Two States

You’ll have to file two part-year state tax returns if you moved across state lines during the tax year. One return will go to your former state. One will go to your new state. You’d divide your income and deductions between the two returns in this case.

Can a married couple file jointly from different states?

There’s no restriction on being married and filing jointly with different state residences. As long as you and your spouse are married on the last day of the year, the IRS counts you as married for all 12 months.

Can a husband and wife have two separate primary residences?

The IRS is very clear that taxpayers, including married couples, have only one primary residence—which the agency refers to as the “main home.” Your main home is always the residence where you ordinarily live most of the time.

How do you allocate income between states?

Option 1: Allocate Based on How Long You Lived in Each State

You can allocate your income to each state based on the number of weeks or months you lived there if your income is relatively the same every month. For example, you might have worked 11 months of the year, taking one month off between jobs.

Why do I have to pay taxes in two states?

You may have to file more than one state income tax return if you have income from, or business interests in, other states. Here are some examples: You are an S corporation shareholder and the corporation does most of its business in a state other than the state where you live.

Do you pay income tax based on where you live or work?

The easy rule is that you must pay non-resident income taxes for the state in which you work and resident income taxes for the state in which you live, while filing income tax returns for both states.

Is local income tax based on where you live or work?

Individuals always owe municipal income tax to the municipality where they work (this is called “work place tax”), but they may or may not owe income tax to the municipality where they live (this is called “residence tax”). Most individuals have the tax owed where they work automatically withheld by their employer.

What if I have two W-2 forms from different states?

You will need to file one federal return and two state returns. TurboTax will walk you through completing your federal return and your part-year resident state tax returns. To learn more you might find this blog helpful.

What happens if you work in two different states?

Some states have reciprocity agreements with each other. This means if you live in one state and work in another, and the two states have a reciprocity agreement with each other, then you will only need to file a tax return and pay taxes for the state in which you lived.

What does total state mean on a W-2?

If you do not have a state abbreviation in box 15 , or any entries in box 16 or 17, you may leave the “total state” portion of box 15 empty, as well. Generally, box 15 will have the state abbreviation and state ID for the employer, so the amounts in box 16 and 17 can be accounted for properly on the state return.

Do I have to report Box 12 D on my tax return?

The Affordable Care Act requires employers to report the cost of coverage under an employer-sponsored group health plan on an employee’s Form W-2, Wage and Tax Statement, in Box 12, using Code DD.

What are the codes in box 12 on W-2?

The W-2 box 12 codes are:

  • A – Uncollected Social Security tax or Railroad Retirement Tax Act (RRTA) tax on tips. …
  • B – Uncollected Medicare tax on tips. …
  • C – Taxable costs of group-term life insurance over $50,000 (included in W-2 boxes 1,3 (up to Social Security wages base), and box 5); Taxable costs are information only.

Why are my state wages and local wages different?

Usually, the difference relates to what wage amounts are taxable in each case. In certain States, items that can be excluded from federal wages (for instance contributions to some types of retirement accounts) are not deducted from state salaries.

What’s the difference between local and state wages?

State wages, tips, etc: The total state taxable gross pay you received. State income tax: The total state income taxes that were withheld from your compensation. Local wages, tips, etc: The total local taxable gross pay you received. Local income tax: The total local income tax withheld from your compensation.

How do I calculate my local income tax?

Local taxes are generally computed based on a percentage of earned and unearned income, but the percentage will vary by location. Multiply the tax rate by your annual income. For example, if you earn $40,000 a year and your local tax rate is 1%, your local taxes would be $400 per year.