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My employer is a trucking company, I live in Mississippi and they collected income tax from me and remitted to PA. How do I get a refund from PA and pay Mississippi income taxes?

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When you file your PA state taxes, you will get the appropriate refund.

When they take withholding out of your paycheck, that is not tax. That is Your Money, and this is a great example of that.

And the idea is that the withholding is to force you to put money into a "savings account" to pay your taxes. Even though it's your money, it's held in escrow by the tax authority until you claim it back. (Of course normally, that amount is about what your tax is, so you get little of it back).

So, you will need to grind through the process of filing Pennsylvania state taxes, including all the "non-resident" sections that normal Pennsylvanians don't have to do. But then, you'll get to the bottom of the PA tax form, and it will say "Taxes owed: $0 (or somesuch), "Taxes Withheld: $1234" (or somesuch), and it'll calculate out to "Refund: $1234".

Then you'll need to do your MS taxes, and unfortunately no withholding was happening there, so you'll need to pay the full boat on May 17.

Sadly, the tax authorities do not care about your cash flow situation.

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There are two parts:

  • Future pay is handled by submitting a new state W-4.
  • Past pay: you will have to file a non-resident form with Pennsylvania to get a refund. You will also have to file a tax return with Mississippi to pay them what they owe. The tax tables may differ so your refund is not likely to equal the amount you owe.

This is an example of why employees should review their pay stubs. The stub should specify which state withholding is being applied.

Any form you file this year will apply to 2020 income. Because you are partway through 2021 you will have to file in both states next April to get back 2021 taxes.

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