When preparing an Individual (Form 1040) return with California for e-file, you may encounter the following diagnostic:
"e-File : For California E-File Purpose. CA State Wages on Form W-2 must add up to total California Wages reported on the CA Tax Return." (ref. 5218)
Please check the entries in (Wages, Salaries, Tips - Code 3 and 13). It is not recommended to use the State Wages, if different for CA returns intended for e-file. Instead, allocate CA Wages to the main form by using the primary wages input.
Make sure in the Electronic Filing (W-2 State/Local) section, (15) St has the state abbreviation and (15) Employer's State ID Number is entered.
How to resolve this diagnostic:
- Click on the Input Return tab.
- Select the Wages, Salaries, Tips screen.
- Scroll to the State and Local section.
- Check the entries in the field (16) State wages, if different (input sheet code 13).
- If there are California source entries in box 16, remove them and enter the California wages in the field (1) Wages, tips, etc. (Ctrl+E if multi-state) (input sheet code 3).
- If the CA wages are less than the Federal wages, enter the state amount with a CA and the remaining Federal amount with a US. Federal will pull the total amount of income while California will adjust for the CA portion of the wages entered.
- For example, California wages are 12,000 and Federal wages are 18,000. This would be entered in the field (1) Wages, tips, etc. (Ctrl+E if multi-state) as 12,000 CA and 6,000 US. Total US will report 18,000 while CA will make an adjustment on Schedule CA or Schedule CANR to show the difference.
- Scroll to the Electronic Filing (W-2 State/Local) section.
- Verify that CA is listed, and that there are no entries in the column (16) State Wages, Tips, etc. [O] (input sheet code 94) on that line.