DMarkM1
Expert Alumni

State tax filing

Yes.  Edit the W2 in the Wages & Income section and change the NJ line box 16 to only the amount that is taxable by NJ but not by NY (should be the "FSA" contribution amount).  Then the total wage in the NJ interview will be correct and you can then allocate the part of that total wage on that W2 that belongs to NJ as normal.

 

You are reporting on your tax return the income that should be taxed by NJ no matter what your employer used (box 16) to withhold taxes.  The tax amount you paid to states is reported in boxes 17 and should not be changed.  

 

@edchen     

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