NJ Resident who Works in NY Getting NJ Tax Credit - Confused about Amount Displayed

[uzi900]

Hi,

I'm a NJ resident who works in NY. I understand that the tax rate in NY is higher than in NJ and that I can only receive a credit up to the amount of tax that would be owed if that income was earned in NJ (so, even if I paid $3000 in tax in NY, I won't receive a $3000 credit for my NJ tax).

My question is about the TurboTax software - TurboTax calculated that I am owed a credit of $2500 for paying NYS tax (this is displayed in the "Credit for Tax Paid to New York" screen). However, when I click on the continue button, the credit amount displayed on the next screen ("summary of taxes paid to other states") is a different number (about $400 less than the prior screen).  If this isn't a bug, it should be explained to the user why the amounts are different. Any ideas? Am I completely missing something? Thank you!

[Vanessa A]

Without seeing the screens you are talking about, it is likely the amount you are actually getting as a credit.  The amount that if you looked at your NJ-1040 Line 44, this is the number you would see there.

So, on the first screen, the credit would be the number that you paid to NY on the next screen, the actual credit. 

[fanfare]

As a NJ resident, you get a credit for tax paid to the State of NY on Form NJ-COJ.

Print and review your tax return carefully before submitting.

@uzi900 

[uzi900]

Thank you for your reply. It's actually not the amount I paid to NYS. There are three different numbers: the amount I paid to NYS, the credit TurboTax is reporting that I'll receive and a different number shown on the third screen. 

[AmyC]

It sounds like you have the first two screens figured out. The first screen is saying you get a credit for the tax you paid to NY. Let's say $1000 for ease as your actual NY liability. Then you have a summary of taxes paid to other states for credit in NJ while is $800 because NJ only gives credit up to their tax liability on the same income.

As for the third screen, you didn't tell us what it says so I can't verify.

[uzi900]

Hi,

Following up about this because I believe the software needs to be made more clear.

After reviewing the PDF produced by TurboTax before filing my taxes, I figured out what's going on. It looks like there are two columns on the NJ return - one for those who own a house and the other for those who do not. One screen reports one value while the next screen reports the other value. TurboTax should either not display the values at all or only show the value that's relevant for the user. 

[LenaH]

TurboTax will choose either the property tax deduction or property tax credit, whichever is more beneficial to you. I did a mock New Jersey return and came to the screen below. The screens preceding this were questions regarding the determination of what is better for your particular tax situation. 

@uzi900