Live in NJ and work remotely for NYC company along with some misc questions.

[js1512]

Hi. Currently I work fully remote for a company in NYC and live in NJ. In my w-2, my NJ taxes get taken away (as shown in box 15). On TurboTax, it says I should first file the nonresident state, NY, first and then do my NJ state. I do get some tax credit, but I want to know how this is calculated as it seems this is done automatically by the software. I owe a bit to NY and I believe this makes sense since NY taxes are higher than NJ.

Also few random questions:

I also made some money and will be getting a 1099. Even though the income I made is not from NYC as I live in NJ, I am still getting self-employment tax deduction from my NY (nonresident). I even explicitly made adjustments in the NY allocation portion to reflect that the income I made from my 1099 is NOT from NY as I chose the option "Not NY state income"  Why would this be?

Lastly, is my office chair (Herman miller) tax deductible (fully? partially?) despite the fact I bought this chair outside of my 1099 date range? I stopped working for my clients and bought the chair when I started my full time job.

Sorry for the many questions, but would like some advice. Thank you.

[GeorgeM777]

You are correct in that the TurboTax software will calculate the difference in what you paid to New York and what you would have paid to New Jersey, assuming your NY source income was earned in NJ.  Per the State of New Jersey, your credit can't be more than the amount you would’ve paid if you earned the income in New Jersey (rather than New York).

Regarding your 1099, if that was NJ source income, it should not be subject to NY tax.  Can you provide the income amounts you entered as well as the categories assigned to each income amount so that we can review your income allocations.  In any follow-up post, do not include personally identifiable information.   

As your office chair was purchased while you were no longer self-employed, then such purchase would not be deductible as a business expense. 

@js1512

[js1512]

Thank you for your reply. I just wanted to note that my NJ tax gets taken away, not my NY tax as shown in my w-2 box 15 (it says NJ, not NY). I want to reiterate that my employer is in NY and I live in NJ (is it weird that they take my NJ tax and not NY in box 15?). That is why I think I owe more to NY than I do to NJ (even with the tax credit). But yes, my NY income was earned in NJ as a remote worker (I live in NJ and work fully remote for my employer who is in NY).

As for this comment: "Can you provide the income amounts you entered as well as the categories assigned to each income amount so that we can review your income allocations.", what specific things do you need? I can either screenshot the numbers or just type them here.

@GeorgeM777 

Thanks for your help.

[TomD8]

If you are a non-resident of NY, and you never actually (physically) worked in NY in 2022, not even for a single day, then your income is not subject to NY income tax.  It is, of course, fully taxable by your home state of NJ.

Hayes v. State Tax Comm, 61 A.D.2d 62 | Casetext Search + Citator

[js1512]

@TomD8 

Thanks for your reply. I do want to apply just in case (to be safe I guess?), but yes I have never physically stepped foot into the NYC office. This is a fully remote position (telecommuting?) and I am classified as remote in the job description. I have done some research, but I am not entirely sure what this entails when it comes to taxes.

[TomD8]

@js1512 

New York had special rules for those telecommuting from outside the state due to the Covid pandemic.

[JosephS1]

As TomD8 stated, your income would not be normally taxed by NYS but only by NJ.  Your W-2 is really the determining factor here.  If in Box 15 there is no mention of NY, and only NJ is listed then do not file a NY return; only your NJ Resident return.