Hi I have similar situation. I live in NJ and worked in Philadelphia of PA. Due to reciprocity, I do not need to file tax for PA (I came to know that from TurboTax. Thank you). Now, I need to file NJ tax and Philadelphia tax. NJ tax filing I can do on TurboTax. But, Philadelphia local tax, I have to do it outside of TurboTax. I followed steps exactly as described above. Very helpful. I clicked the small check box to get credit for paying Philadelphia Tax and clicked no on another line below (as shown on 3rd screenshot above). The confusion I am having are these: On my NJ State section of W-2, I see on box#16 (State wages, tips, etc) showing 35,097. However, box 17 (State income tax) is left empty. So, does this mean my employer did not withhold any NJ state tax? And on Federal filing section of W-2, I see box 15 (State) showing empty, box 18 (Local wages, tips, etc) showing 37,050 (slightly higher than the box 16 for NJ). And box 19 (Local income tax) showing 1,280 and box 20 (Locality name) showing PHILADELPHIA.
In summary, On NJ section of W-2, It looks like NJ state taxable income is mentioned, however, no NJ tax is withheld. Then on Federal section of W-2, Philadelphia taxable income is showing (slightly higher than that of NJ taxable) and the Philadelphia locality tax withheld (1,280). Now, can I say I have been double taxed and get credit for Philadelphia tax paid?
