From NJ 601-1 from the New Jersey Division of Taxation:
"Include on Line 1 only amounts properly taxable by the other jurisdiction. In general, this includes compensation for services performed; net profits from a business, trade, or profession carried on in the other jurisdiction; S corporation income allocated to the other jurisdiction; or income or gains from the ownership or sale of real or personal property in the other jurisdiction."
https://www.nj.gov/treasury/taxation/pdf/pubs/misc/nj601_i.pdf
I do not believe that in actual practice NJ subjects its residents who work remotely for an NY employer (and are taxed by the State of NY) to double taxation.
I would also point out that NJ allowed its residents who worked remotely for Massachusetts employers and who - per Massachusetts law - were taxed by MA during Covid, to take the other state credit.
**Answers are correct to the best of my ability but do not constitute tax or legal advice.
