Necessity for multiple state return

[tahoeboy95]

Hello community!

     I live in NJ but have worked in NY for the entirety of 2021.  In the past, I have had to file both NJ and NY state returns, and everything works out in the end.  I used the TurboTax application for my 2021 return instead of the online version this year, and as I was entering Federal and going to state, Turbotax told me it would let me know if more than one state return is required.

     Turbotax did not say at any point I needed more than one state, so I completed federal and NJ state (my state of residence) with the info from my W2 and have e-filed them.  My questions are:

1. Do I need to file a New York state tax return like in years past?

2. If so, do I need to amend my federal and NJ state if I file NY after Federal and NJ have been submitted?

I'm so confused, any help would be appreciated.  Thanks!

[LenaH]

If you worked in New York, you will need to file a nonresident New York return as you did in prior years.

Then, you will need to amend your New Jersey return to get the credit of taxes paid to New York. 

You may also have to amend your federal because the amount of state and local income taxes will change. This will be especially important if you take the state and local tax deduction and if you itemize your deductions on Schedule A. Generally, the New Jersey credit will not be the exact amount of taxes paid to New York because New Jersey uses the proportional credit limitation. The proportional credit limitation (PCL) amount represents the amount of Income Tax New Jersey would have imposed if the income you earned in New York had been earned in New Jersey. 

For more information, please see How to amend (change or correct) a return you've already filed. 

[tahoeboy95]

Hello Lena,

Thank you for your response!  Here's where I'm at:

1. I purchased the NY state return through the Turbotax application and filled it out.

2. I did not file NY yet, as I was reading the info about amending a return.

3. I started the amend process on the TurboTax application, and it determined that there were no changes between what I filed and what was there after reviewing the return.

So, I have not submitted an amended return yet, because there is no difference according to the software (which is true in so far as my federal and NJ state returns. I answered all the out of state questions on federal and NJ correctly the first time).

Do I just submit the NY return I've completed within TurboTax?  

[tahoeboy95]

Hello Lena,

     If I go to submit the NY state return, TurboTax says I owe the full tax amount.    The last time I filed two states together (instead of one state then purchasing another state afterwards), I don't remember this happening, as the NJ refund I believe covered the NY bill.  

I need help, and would be willing to pay for a premium TurboTax service if one exists to assist with a return already submitted through the desktop application.  Could you provide suggestions?  Can anyone?  Thanks

[DawnC]

If you have already purchased NY software for the desktop, use that instead of Online.   Online is going to charge you for federal and both states.    Open the federal return (w/ NJ resident) you did file through the TurboTax desktop.    Add the NY nonresident return (i believe you already purchased the desktop software for NY) and allocate all of your wages (assuming you only worked in NY last year) to NY.   You will owe the state of NY so you will have to pay them directly.    The NJ return will need to be amended to add a credit for the tax you pay to NY, so you will eventually get a refund from NJ.  

You are dealing with 3 different tax agencies (IRS, NYS, and NJ state) and one won't take payment from either of the other two.    The NJ will have to be amended because you have not added the credit for tax paid to NY yet.   You won't know how much credit you can take on the amended NJ return until you complete the NY nonresident return.   Use the desktop to add NY and change the NJ return since you already have paid for the software.