I live in NJ but work in PA. My only income comes from PA. From what I understand, Pa and Nj have a reciprocity agreement so do I still need to file as a nonresident for Pa

[KatrinaB48]

No, as long as your employer has only withheld state tax from your resident state of New Jersey, you don't need to file a Pennsylvania return.

[JLD1]

i live in nj work in Philadelphia. the w2 shows taxes withheld in PA not NJ. Do i have to file a PA and New Jersey return?

Also i do not see any mention in the rey=turn regarding Philadelphia wage tax (which witholding was taken out)

[MaryK4]

Yes, if you did not tell your employer to withhold NJ tax instead of PA, you will have to file a nonresident Pennsylvania return and a New Jersey Resident return.  Because of the reciprocity agreement, you can choose to file zero income for PA to get a full refund of withholding OR nonresident with PA source income and get the credit for taxes paid to another state on NJ resident return.  

[JLD1]

thank you - one more question 

they withheld Philadelphia wage tax - do I owe this?

[DMarkM1]

Yes.  The reciprocity agreement between these two states does not include city wage taxes.  Here is a link from the NJ tax authorities on the subject.  You will need to claim a credit on your NJ return for the city tax paid to Philadelphia.