I was working and living in NJ until I moved to PA in July, while still working in NJ. I notified my employer when I moved to PA, however my W2 shows that I was only taxed in NJ. How am I supposed to file this?
If you made a permanent move from NJ to PA during 2016, you will need to file part-year resident returns for both NJ and PA. This will treat you as a resident of each state only for the days that you lived in that state so that you can avoid being double-taxed.
Because PA and NJ have a reciprocal agreement related to wages, just divide your NJ-sourced wages based on the time in each state and report these amounts separately on your part-year resident state income tax returns of each state.
So for state tax purposes, you will need to divide up your wages based on the time you were a part-year resident of each state. If your employer only withheld taxes from one state, you may owe taxes in the state for which no state withholdings were taken out but you may get a refund in the state where extra withholdings were taken out.
Check below for more information about filing a part-year state tax return (Please select "see entire answer" to see full answer)