New Jersey Return

[Bunzy11]

Hello, 

My employer messed up my withholding and said I was a resident of New Jersey for half the year. I filed my state returns and tried to get all of my $911 withholding back. I had to file a paper return for some reason and they only sent me a check back for $65. What next steps should I take? I tried reaching out to the New Jersey taxation department, but I have not had any luck yet. 

[NCperson]

@Bunzy11 - what was the other state? 

where did you live in 2022? in one state or multiple states? which ones? 

in what state(s) did you file a tax return?

hard to explain what is required to do without that additonal detail. 

[Bunzy11]

Hello @NCperson, 

First, thank you for your response.

Second, I lived in Missouri as of 2022 but I took a new position that was based out of New Jersey but I am working remotely. So the HR group changed my living location to NJ and started the withholding. I filed a state return for both Missouri and New Jersey. 

[TomD8]

NJ does not tax non-resident remote income.  If you never resided in nor actually (physically) worked in NJ during the tax year, then your work income is not taxed by NJ.

If this is your situation, and your employer mistakenly withheld NJ taxes from your pay, then the procedure is to file a non-resident NJ return on which you report the withholding but allocate zero income to NJ.  This should result in a full refund of the incorrectly withheld NJ taxes.

Your income is of course 100% taxable by your home state of MO.

[Bunzy11]

In this case, does that mean I have to amend my state return? I, well Turbo Tax, put 0% as my income percentage on line 41 of the NJ state return. 

[TomD8]

If Line 41 of your NJ 1040NR was zero, then 100% of your NJ withheld income tax should have been refunded.  Does Line 59 show the full amount of the withheld NJ income tax?

[Bunzy11]

Yes, on the NJ 1040 NR I put 0% and line 57 says the NJ withheld income tax should have been refunded. They sent an adjustment document back. 

[TomD8]

Adjustment letters normally include a reason for the adjustment.

[Bunzy11]

It said "amount of New Jersey wages adjusted per wage and tax statements submitted". Are there any next steps I should take? 

[TomD8]

The adjustment letter should contain instructions on how to appeal.  Follow those instructions and explain that in 2022 you neither lived in nor worked in NJ, and that your HR department mistakenly listed you as a New Jersey resident, resulting in an incorrect W-2.

[Bunzy11]

Thank you so much! This was extremely helpful.