Why does my NJ return show income of $47,241 when I only earned rental income of $3231 in NJ?

[hehinsch]

Why does my NJ return show income of $47,241 when I only earned rental income of $3,231 in NJ?

Is income earned out of state, my residence state taxable in NJ?

[SweetieJean]

What is your residence state?

[hbl3973]

First off: Don't Panic!

New Jersey, as with most states that have a progressive tax system, i.e. larger incomes are taxed at a higher rate, use the "unitary method" of taxation for part year residents and nonresidents. Under this method, NJ first calculates what tax you would have paid if you had been a full year NJ resident and then charges you just the fraction of it that is attributable to NJ income.  That is why NJ needs to know your full income.

Unitary taxation was introduced many decades ago to prevent millionaires from splitting their income across multiple states and localities and claiming poverty-level tax rates in each of them.