DianeW
Expert Alumni

State tax filing

@impromptu97 On the NY return all worldwide income is included and taxed, then they allow a credit for taxes paid to NJ (another state on the same income).  Do the NJ return by selecting a status of Nonresident.  Include the wages on the NJ return that are earned from working there, do not reduce the NJ income. This return must be completed first so that NY knows the amount of the credit for taxes paid to another state on the same income.  NY doesn't want you to pay tax on the income twice.