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Lev, Tax Advisor
Category: Tax
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Experience:  Taxes, Immigration, Labor Relations
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Does a non resident working remotely pay state income tax

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I live in a no income tax state (Washington). I do consultant work. The first two weeks of March 2008 I was not engaged and drew my base salary. On March 17 I started work for a hospital in Columbus, Ohio. I worked one week on site in Ohio and the next week remotely via the internet from my home in Washington State. My company reported all of my March salary as Ohio income even though I only worked in Ohio one week. My questions are: 1. when I file a 2008 Ohio income tax form can I deduct the first 2 weeks salary from the W2 reported Ohio income since that income was prior to working for the Ohio hospital? My employer is reluctant to amend the March state earnings report. 2. Is the salary for work done remotely for the Ohio hospital while I am physically present in Washington state (every other week) Ohio taxable income?
Submitted: 8 years ago.
Category: Tax
Expert:  Lev replied 8 years ago.
Did you work as an employee (with W2 reporting) or as self-employed contractor(with 1099misc) reporting?
Customer: replied 8 years ago.
Employee with W 2 reporting.
Customer: replied 8 years ago.
I should clarify. I get a W 2 from the consulting firm I work for. I do not get a W 2 from the hospital. The hospital pays the consulting firm, the consulting firm pays me.
Customer: replied 8 years ago.
Hello, are we still in contact?
Expert:  Lev replied 8 years ago.

Generally - you pay taxes based on your place of employment.

Thus - if your place of employment in Washington - your employer should be registered in Washington and pay employment taxes there.

In your situation your employer likely maintained the place of your employment in Ohio and payed all employment taxes in Ohio - that is why they refused to amend your W2 form.

Assuming that you will file your Ohio income tax return as non-resident. - mark that you was no-resident in the header and report the state of your residency -

On the schedule D line 63 (see page 3) - Enter the portion of Ohio adjusted gross income (line 3) that was not earned or received in Ohio.

You may need to add the form IT 2023 - - see also instructions -

However as your company reported on W2 that all your income was earned in Ohio - you may expect that Ohio DOR will disagree with your tax assessments and will ask to provide evidence that your income was actually earned outside the Ohio. You may ask your employer to write a letter to the Ohio DOR as a proof that your actual work place was indeed in Washington.

In additional you may provide the Affidavit of non-Ohio Domicile for Taxable Year 2007 - Nonmilitary.


Customer: replied 8 years ago.
Thanks for the information on filing. Just to make sure I understand the basic rule behind the forms please confirm or correct my understanding.

I am resident of a no income tax state (Washington) who is a w-2 employee of a consulting firm doing work for a hospital in an income tax state (Ohio). Pay for work performed for the Ohio hospital while I am physically present in Ohio is Ohio taxable income. Pay for work performed remotely over the internet for the Ohio hospital while I am physically present in Washington state is not Ohio taxable income.

Did I get that right? Thank You
Expert:  Lev replied 8 years ago.

The income would be consider as from Ohio sources - if that income earned while you physically worked in Ohio - that is correct.

However - you need to confirm that - the most common accepted confirmation is a letter from your employer. But in your situation I doubt that your employer would provide such confirmation because they are likely not registered to do business in Washington and may not have employees in Washington.

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