This link takes you to instructions on how to enter the credit entry in NJ. return. You're filing NY as MFJ. NY is taxing your spouse's 414H carried from your federal return. If the NY returns were filed MFS I don't think this would be an issue. But the credit for taxes paid to other states would certainly be easier and resolve the problem.
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TurboTax How can I calculate the other state tax credit as a New Jersey resident who works in New York?
