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State taxes due, but to what state?

My wife did some out of state contracting work as an employee of a consulting firm last year. Our state of residence and domicile has no income tax. The firm of whom she was an employee is based in Illinois. The work was done on site in yet a third state, which also has an income tax. My wife was never physically present in Illinois, except perhaps changing planes at O'Hare.

Her W-2 is showing that IL taxes were withheld, and is not showing any mention of the state in which she actually worked. How should we proceed? Is the W-2 correct? Do we need to get a corrected W-2? What further questions should I be asking?

Any help would be appreciated.

Bill.

Reply to
bill-deja
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When she started working there she should have notified them of her address, and should have noticed that paychecks were withholding taxes in IL.

You must file an IL return and say are a non-resident and no IL source income, and request a refund of all IL tax withheld.

Also need to file a return for the third state where she worked and declare all the income earned while she worked there. It's my understanding that companies are required to withhold taxes based on where you work, and multiple states if necessary, but most don't do that. Also I don't think employees file in the states they work.

Reply to
remove ps

When she started working there she should have notified them of her address, and should have noticed that paychecks were withholding taxes in IL.

You must file an IL return and say are a non-resident and no IL source income, and request a refund of all IL tax withheld.

Also need to file a return for the third state where she worked and declare all the income earned while she worked there. It's my understanding that companies are required to withhold taxes based on where you work, and multiple states if necessary, but most don't do that. Also I don't think employees typically don't file in the various states they work, but they should. In your home state tax return you get a credit for tax paid to the other state (or vice versa), but as your home state has no tax this is not an issue.

Reply to
remove ps

really ? she "worked" for the consulting company based in IL, was paid by the consulting company, and not at the client..... regardless of the location of the "work performed" ?

Reply to
ps56k

Really. The employee had no connection to Illinois except that that's where the employer is located. So is Boeing. That doesn't mean that every Boeing employee, no matter where, pays Illinois income tax.

Phil Marti VITA/TCE Volunteer Clarksburg, MD

Reply to
Phil Marti

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