I live in NJ and work in NY. MY W-2 has an amount in Box 17, which state do I apply that amount to, NY or NJ?

[Anonymous]

I am trying to complete my taxes and needed guidance. I live in NJ and work in NY. I received my W2 and there are amounts in Box 15 & 16 one is for NY and the other for NJ. My W2 shows an amount of Box 17, which state do I apply this amount to, NY or NJ? Or is the amount applied to both states? 

[DanielV01 · Accepted solution]

New York.  What you should be seeing is that the amount in Box 17 is on the New York line.  On the W2 screen in TurboTax, you will first enter the NY information in boxes 15-17 (not 18-20, although this should be blank), click on the box Add Another State, and then repeat the procedure with the information from the New Jersey line (NJ).  Proceed with preparing the Federal Return until you complete that portion.

For the state returns, prepare the New York return first.  New York is your nonresident state, and New Jersey will allow you to claim a credit for tax you pay to New York on the income you earn there.  Prepare the New York return first so that the credit carries over to the New Jersey return correctly.

Then, when preparing the New Jersey return, the following procedure will eliminate income that may have been doubled-up because of programming.  On the NJ return, you will see a screen titled About Your W-2 State Wage Information.  Because of state programming requirements, TurboTax includes both income lines as part of the NJ income.  The next screen is titled Let's Confirm Your Taxable State Wages from (Employer).  Click on the NY box so that those reported wages are not included on New Jersey's return.

[pinaleonard]

Question - so there should not be an amount in Box 17 for the NJ line? It should only be on the NY line?

[MaryK4]

Usually, if you live in New Jersey and work in New York (or vice versa), you will have the State Info boxes (15-16-17) completed because in most cases you must file a state tax return in both states.

@pinaleonard

[Kaitlinsullivan97]

I’m in this same situation. My W-2 has two states in Box 15 and two different amounts in box 16. I work in NYC but live in NJ. I moved to New Jersey from NY in March 2021. For box 17-20 there are no numbers in the NJ column only number in NY.  What does this mean for me when I file taxes? 

[ErnieS0]

It probably means you employer split your wages to show how much you earned as a New Jersey resident.

New York and New Jersey tax income differently. There is no NJ withholding because you still have to pay NY tax for the whole year because you continued to work in NYC and NJ gives you a tax credit that covers most or all of the NJ tax from your NY job.

New York

You'll file a part-year return for New York but report 100% of your income (since you continued to work in NY after moving to NJ).

New Jersey

File a part-year return and use your NJ wages (I'm assuming that is the part-year amount). 

NJ gives you a credit for tax paid to NY because your income was double-taxed since the move. Since you are part-year you'll have to figure the credit by hand.

Multiply your NY wage and your NY tax liability (not withholding) by roughly 10/12 (you can use actual days, or partial months) and enter those numbers in the Other State Tax Credit section of New Jersey,.

The NY wage amount may be lower than your NJ W-2 wages but NJ only gives you credit for actual income taxed by NY. NJ wages are generally higher so there is some leakage, meaning you don't get full credit and may owe a bit to NJ.

[Kaitlinsullivan97]

Okay thank you! My New York wages in line 16 is my full wages and salary for the whole year. Where line 16 for NJ is I assume just the amount I made as a NJ resident. When filing for state do I have to subtract the whole year salary listed in line 16 for NY from NJ to be able to say how much I made when I lived in NY or since I work in NY I keep the whole amount.  

Same question  goes for federal. When I have to fill in the information on line 15-20 for both states do I have to do any subtraction to find out how much I made during the months I lived in NY  or just put exactly what is there ( my whole salary). 

[GeorgeM777]

@Kaitlinsullivan97   To follow-up on the comments from @ErnieS0 and based on your last post, it appears now that your employer did not split your wages.  Your return preparation would have been easier had your employer correctly allocated your wages to reflect what you earned as a NY resident, and what you earned as a NJ resident.  However, based on your last post, it appears your employer designated all of your wages as NY wages with nothing showing for NJ.  Ordinarily in circumstances like your own, the approach to take is to allocate wages consistent with the comments from @EarnieS0; however, in your case, your W-2 has already been filed with the IRS, as well as the relevant revenue departments of NY and NJ.  If you were to modify the amounts on your W-2 to reflect your tax situation (splitting your wages between NY and NJ) you will be entering information inconsistent with the entries on your W-2.  Given your situation, the preferred approach is to get your employer to issue you an amended W-2; however, we realize that may not be possible this point.  But you should still try to obtain an amended W-2.

Perhaps the best option at this point is to enter the information as it appears on your W-2.  However, make sure in the Personal Info section of TurboTax that you have accurately entered your residency information.  In other words, you need to reflect that your residency changed to NJ from NY in March 2021 (assuming that is the case, determining residency is fact specific).  It may be that your employer withheld NY wages for all of 2021 as if you were a NY resident for all of 2021 despite the fact that part of your W-2 does reflect that you lived in NJ.  Thus, when you complete your NY return, and you should complete the NY return first as it is your non-resident state, your NY return will reflect that you were a part-year resident of NY.  As @ErnieS0 mentioned, you will get a tax credit, on your NJ return, for having paid NY taxes.  The tax credit will likely offset most of your NJ tax liability as NY taxes are generally higher than those of NJ.  Moreover, there is also a NY City tax.  

[Kaitlinsullivan97]

Yes I does seem that my employer has done something incorrect. There are two wages listed one for NY and one for NJ, but the one for NY is my whole yearly salary. Say I made 80k total all year that is what is listed for NY in box 16. For NJ in box 16 it has a portion of the 80k, say 60k. But I did not make 140k this year only 80k. So I believe the portion amount is what I made in the 9 months I lived in NJ. But my NY total is just the whole amount that matches what it says in line 1. Seems like something might be off. I believe that is what is causing extra confusion for filing. 

[MarilynG1]

If you worked in New York all year, then all of your income is reported to New York as a Non-Resident, so the total income in Box 16 of your W-2 is correct.

If your employer started taking New Jersey taxes at some point, you may end up owing New York, as they will tax all of your income earned there.

Normally, you would pay tax to New York on all your income earned there and when you then report all your income to New Jersey (as a Resident) they will figure your tax and give you credit for what you paid to New York.

Click this link for info on How to File a Non-Resident State Return.  Prepare your New York return first, then your New Jersey one.