NJ State not allowing Commuter Transportation deduction for 2014. Employer did not show amount on W2, but deducted it from Federal Wages. Do I owe additional State tax?

State of NJ is not allowing Commuter Transportation Benefits deduction from 2014 income, says we owe taxes on the amount we deducted ($1,560). Employer did not indicate amount on W2, but deducted it from Federal Wages but not State Wages. Are they right that I owe the additional taxes (~$127)? Is it worth fighting?

902

Level 10

Jun 1, 2019 4:37:52 AM

NJ and the Fed have different Commuter Transit benefits and different rules. Sadly NJ has much stricter requirements and normally taxes it. Your employer would have to follow NJ rules for it to be deductible in NJ, most out of state do not. I had to amend 4 years of returns after NJ sent me a bill a few years back and I learned that NY made transit benefit easier to claim and didn't meet the NJ rules. Sorry, but believe me if they sent you a bill for a prior year deduction, pay it and also amend and refile following years as they hit me up each year until I amended and the interest adds up fast and they always waited a year to mail me the next years bill.

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NJ State not allowing Commuter Transportation deduction for 2014. Employer did not show amount on W2, but deducted it from Federal Wages. Do I owe additional State tax?