In 2013 I've worked in Virginia and lived in Maryland the entire year. My wife worked in Maryland.
My employer withheld state taxes for Virginia (I asked my employer whether he could withhold my state taxes for Maryland instead of Virginia, and he said that he couldn't do it). My wife's employer withheld state taxes for Maryland.
We filed a non-resident tax return in Virginia, and got all the withheld state taxes back. We filed a resident tax return in Maryland and payed the tax we owed on 4/15/2014.
We recently received a letter from the Comptroller of Maryland saying that we owe an interest for underpayment of of estimated tax.
The letter says :
(205) - You owe interest because your withholding and/or estimated tax payments were not sufficient to meet the requirements of the law.
Since it's not my fault my employer didn't withhold state taxes for Maryland, why should I be punished? Is there a way to avoid this penalty?