1. Remove WI and correct NJ.
- Live in WI, WI taxes all income and will give a credit for tax paid to other states.
- Work in NJ. NJ NR instructions state: You must file a nonresident return if you received income from a New Jersey source while you were a nonresident and your income for the entire year (not just your period of nonresidency) was more than the filing threshold for your filing status (see page 2). Only report income you earned while a nonresident of New Jersey.
- The IRS and states have received your W2 forms. This is your time to enter the correct information. Enter your W2 showing NJ with the correct wages earned there. It sounds like all of your work was remote from NJ and the full amount of income should be entered for NJ wages. You may want to contact your employer and ask why the w2 shows only half of your income.
2. You work remote with NJ source income so 100% earned there.
Extra:
- If you had any WI tax withheld, you will need to enter it following my steps here.
- Complete NJ return first. WI will give you a credit. The credit will be the lower of the state tax liabilities on the same taxable income. You may owe your resident state, if they have a higher tax rate along with differences in how the taxable income is calculated.
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