Indiana DOR Finds Ohio Resident’s Wage Income Subject to County Individual Income Tax, Denies Refund

The Indiana Department of Revenue (DOR) Feb. 24 determined in a letter ruling that Taxpayer wasn’t entitled to an additional individual income tax refund because she worked in Indiana and her wage income was Indiana source income subject to Indiana county income tax. Taxpayer, an Ohio resident, began working for an Indiana employer, who withheld tax on wages paid to Taxpayer. Taxpayer filed a reciprocal nonresident Indiana individual income tax return, claiming that she was entitled to a full refund of tax withheld. The DOR reviewed and adjusted Taxpayer’s return and assessed Taxpayer additional tax, penalty, and interest. Taxpayer protested. ...