I worked for a company based in NJ, but live in IN and worked remotely. Visited NJ for a couple of meetings. W2 lists NJ in box 15. Should I have paid IN or NJ taxes?

[mstreet11]

I'm assuming that because NJ is one of those few special states, I need to pay the NJ taxes, then deduct them from my Indiana return, and not get a credit or carryover for the difference in the Indiana tax rate being much lower than NJ even though I never really worked in NJ?  Would it have been different result if my employer would have set things up with IN marked in box 15?

[DDollar · Accepted solution]

Your income is not taxable by New Jersey just because your company is based in New Jersey.  But since your employer withheld New Jersey state tax, you will have to file a NJ non-resident return to receive a refund.  As a resident of Indiana, your income is taxable by Indiana, so you'll have to file an Indiana resident return.  Prepare your NJ return first, and indicate allocate $0.00 income to NJ.  You'll receive a full refund, which you can use to pay Indiana.  You should have your employer change your withholding.