Hi, This question is for people who live in one state but commute to work in another. I live in NJ and work in NYC and I am not sure while filing the state tax return which form do I need to use NJ or NY. My company is located in NJ and all my payrools are generated in NJ, but in W-2 Box 15. State is filled as NY, so now I am confused where should I file taxes.
Anyone has any idea on this one?
Thanks a lot. [ February 24, 2006: Message edited by: Jay Ashar ]
The laws vary from state to state, but I'm sorry to have to tell you that in your case, the correct answer is "both". There is at least one lawsuit currently in the courts brought by a NJ/NY telecommuter who doesn't want to pay taxes to both jurisdictions. For now, I believe you're legally obligated to. California has similar laws. Other states are more permissive.
Although you must pay your taxes to both states, it doesn't end up to be a double state tax (at least not in my situation of CT/MA and MA/NC). From what I remember, you pay the highest of the two state taxes to one state, and the other state tax simply reduces to zero. The easiest way to file for me was to use a tax preparation software (such as TaxCut or TurboTax). The software "knows" the laws of all 50 states and figures your liability for you.
NJ and NY do not have a reciprocal tax agreement. you must file in both and if you work in the city I believe you also file city taxes. I did work in NY but not the City.
NJ and PA have a reciprocal tax agreement, if you work in PA and live in NJ as I did you only file NJ state taxes, BUT if you worked in Philadelphia you also had to fiel and pay city taxes.
Apparantly the only thing NJ and NY can agree on is breaking it off in your **** in tolls for going over the bridges.
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