SDI amount taxable in NJ state

SreenuPrabhaGMAl · ‎March 22, 2026

Employer showed SDI deduction $238 in W-2 box 14. box14 Tax payer working in NY state (non-resident IT-203) and lives in NJ state(resident NJ-1040).

-is SDI amount in W-2 box 14 taxable for NJ state? or SDI (State Disability Insurance) item tax exempt from gross taxable income
-Does this box 14 amount be added to state wages for NJ-1040 line 15 item? or NJ-COJ line 2 amount?

Fact: Box 14 items like IRC 414H, IRC 125, IRC 132, FRINGE are taxable in NJ state.

MaryK4

No, the SDI amounts are not taxable for New Jersey. The SDI amount represents a mandatory contribution (tax) withheld from your wages, not income.

It is not added to NJ state wages.

Unlike the items you mentioned (IRC 414H, IRC 125, etc.), SDI is an after-tax deduction for state purposes. It does not get "added back" because it was never excluded from your NJ Gross Income in the first place.

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"

SreenuPrabhaGMAl

Thanks for insight. Box 14 items like IRC 414H, IRC 125, IRC 132, FRINGE are add back to NJ wages, where as for SDI item in box 14 not sure.

Turbotax (dropdown menu) not even recognizing IRC 132, FRINGE however we know that these two items in box 14 are add back to NJ wages despite the fact that NJ state taxation instructing to add back and NJ state doesn't exempt unlike Federal, NY state.

-is there any NJ state reference that provides list of all exempted box 14 entries/items?

reason why again requesting: SDI amount withheld, paid for NY state, W2 shows NY state in its boxes (Box 15 = NY, Box 16 = NY-wages, Box-17 = NY-taxes) not New Jersey state

following point is not clear a bit: "The SDI amount represents a mandatory contribution (tax) withheld from your wages, not income." - indeed it is income withheld from wages, income (wages) for employee from employer thru W2. Thank you for earlier clarification.