Thanks for your help.
You mentioned, "you just reduce your NJ tax by the loss on the K-1." However, I tried TT, NJ State e-file, and one another e-file software. All them seem to include my federal K-1, however, none of them take my loss into account for NJ state filing (i.e. my NJ taxable income or the NJ tax is not reduced).
Just to see what difference it would make, I entered a profit and sure enough, a profit increases my NJ taxable income and tax.
Now I am confused; are all tax software inaccurate or NJ unfairly only considers profit to collect more tax but loss is not considered?
