State tax filing

Yes. You have to split the New York wages. NY requires employers to report total wages in W-2 box 16. You can allocate the NY portion in the New York section of TurboTax.

The New York section will ask you whether all your income was earned in NY.

1. On New York Income Allocation, say No to Were all of your wages and/or your self-employment income earned in New York State?
2. Edit Your W-2 on Your Form W-2 Summary
3. Choose Allocate by Number or Days or Allocate by Percentage on Allocate Wages to New York (percentage is usually the easier calculation)

Pennsylvania

You will need a nonresident PA return. PA kept in place pre-Covid-19 work arrangements so if your wife worked in Philly pre-pandemic then she is still considered a PA employee while working from home due to the outbreak.

PA and NJ have reciprocity so your PA income would be January to June. After you moved to NJ, the income would be sourced to NJ. There would be no NJ withholding because you can claim a credit for Philadelphia Wage Tax against those earnings.

Delaware

You are a part-year Delaware resident. DE allows you to file two ways — as a part-year resident and a part-year nonresident. Filing as a resident pulls in all your income. Generally filing as a nonresident is better. You can switch the button and see if it makes a difference and choose the better option.

Tax Credits

• Delaware. Credit for NJ paid. NJ had temporary Covid-19 rules until September 30 that required employers to source income in accordance with the employer’s jurisdiction so you would be a "NJ employee" and can claim a credit on double taxed income, This is better because it matches your W-2.
• Pennsylvania. No tax credits. This is a nonresident return.
• New Jersey. Credit for Philly and New York tax
• New York. No credit. Nonresident return.