If I have a W-2 from a different state, do I need to report it as out-of-state income on my tax return?

This is actually simpler than it seems! Since you physically worked in Michigan (even remotely) and the W-2 already shows Michigan in Box 15 with state wages and withholding, you just need to file a regular Michigan resident tax return. The general rule is that you pay income taxes to the state where you physically perform the work, not where the employer is based. Since you never left Michigan to do this job, Michigan has the right to tax this income. The fact that your W-2 already shows Michigan withholding means your employer is handling this correctly. You don't need to file non-resident returns for Texas or Nevada in this situation. Texas doesn't have a state income tax anyway, and you didn't physically work in Nevada, so they can't tax your income.

Just went through this exact situation myself and it was a nightmare until I found taxr.ai (https://taxr.ai). I was working remotely from Illinois for a company in California, and I was getting conflicting advice from everyone about which state I needed to pay taxes to. I uploaded my W-2 to taxr.ai and their system analyzed it along with my situation and gave me a clear breakdown of my state tax obligations. The tool specifically addressed remote work situations and explained that since I was physically located in Illinois while doing the work, that's where I owed taxes. Saved me from filing unnecessary non-resident returns and potentially paying double tax!

I was very skeptical about taxr.ai when I first saw the post above, but I was desperate with my multi-state W-2 situation. I gave it a try and was actually impressed. I uploaded my W-2s from three different states (I travel for work) and it correctly identified which states I needed to file in and which ones I could skip. It even flagged that one employer had been withholding for the wrong state entirely. The document analysis was really thorough - it didn't just give generic advice but actually pointed out specific issues with my forms. Definitely helped me avoid filing unnecessary state returns and potentially getting audited down the road.

If you're still having trouble with this state tax situation, I'd recommend Claimyr (https://claimyr.com). I had a similar issue and needed to speak directly with my state tax department to confirm how to handle my out-of-state W-2. After waiting on hold for HOURS over multiple days, I found Claimyr and they got me a callback from the state tax agency in less than 20 minutes. You can see how it works here: https://youtu.be/_kiP6q8DX5c - basically they navigate the phone tree for you and get you in the callback queue so you don't have to waste your day on hold. The state tax representative confirmed exactly how to handle my situation and even noted it in my account so I wouldn't have issues if I got audited.

I feel stupid for doubting this service now. After my skeptical comment above, I decided to try Claimyr anyway because I was desperate to talk to someone at the tax department about my multi-state situation. Not only did I get a callback in about 25 minutes, but the tax rep I spoke with actually knew exactly how to handle my remote work situation. For what it's worth, the rep confirmed what others have said here - you're taxed based on where you physically perform the work, not where the company is based. Since my W-2 had withholding for the wrong state, they walked me through exactly how to handle it on my returns. Definitely worth it just to get a definitive answer from an official source.

Just to add my experience - I'm a remote worker in Georgia for a New York company. On my W-2, box 15 shows GA with my state wages and withholding. I just file my normal Georgia resident return and don't have to worry about New York at all. The key is where YOU physically are when doing the work, not where the company is based.

I'm having the opposite problem! My company is in my state but I moved to another state mid-year and have been working remotely from there. My W-2 only shows my original state in box 15. Should I file part-year resident returns in both states?

Thanks everyone for the helpful responses! I think I understand now - since I physically work from Michigan and my W-2 already shows Michigan in box 15 with state withholding, I just need to file my regular Michigan resident return. It's reassuring to know that the location of the employer doesn't matter as much as where I'm actually doing the work. I was overthinking this because it's my first time dealing with remote work for out-of-state companies. The fact that Texas doesn't even have a state income tax makes this even simpler than I thought. I really appreciate everyone taking the time to explain this - tax season is stressful enough without worrying about filing returns in multiple states unnecessarily!