DanielV01
Expert Alumni

Deductions & credits

Yes, if you are a contractor.  If your contract work takes you physically into PA, then that income is taxed in PA as a nonresident and NJ as a resident.  Self-employment income is not covered by the state reciprocal agreement.  You will prepare the PA return first, and then claim a credit on your NJ return for the tax you pay to PA on the income earned there.

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