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Dynamics AX 2012 Payroll – Pay Statement does not display the appropriate taxes based on where the employee works and resides 

When reviewing a Pay Statement for an employee that works in one state but resides in another state, we are seeing that the state taxes display for the state where the employee works as opposed to the state where the employee resides. This applies to Dynamics AX 2012 R2 and Dynamics AX 2012 R3.