- I worked in NY the whole year with $200k of W2 wage income
- I also earned $20k of passive income (interest, dividends, capital gains) during the year
- I also have $5k of rental income from a rental property in NJ
- I lived in NY (not NYC) for the first 9 months then moved to NJ
- Only NY state taxes were withheld from my W2 and I paid no estimated taxes to NY or NJ
So I have both NY source income (full year wages + part-year passive income) and NJ source income (full year rental property + part year passive income), and a mid year change in residence.
Which forms should I be filing (resident vs. non resident, full year vs partial year), and which order should these be done in? I am using Turbotax desktop.
Box 15 of my W2 shows $200k of NY state wages but also $70k of NJ state wages (recall that I only had NY state taxes withheld). Is the $70k what I put when Turbotax asks me about "double-taxed income while a resident of NJ"?
You file as a part-year resident of each state. This previous TT answer explains how to do that, including the recommended sequence: https://ttlc.intuit.com/community/state-taxes/help/how-do-i-file-a-part-year-state-return/00/26057
This previous TT answer has some info on doing the part-year NJ return. (Change the year in part 5 of the answer to 2019): https://ttlc.intuit.com/community/state-taxes/discussion/can-i-file-both-a-resident-and-non-resident...
Your "double-taxed income while a resident of NJ" is the portion of your wage income received after you became a resident of NJ. You became an NJ resident on the day you began living in your new home in NJ.
I'm not sure if my employer's data is accurate for when I became a resident of NJ. It may just be based on an estimated move date, not the actual date I moved. Can I just ignore that amount on my W2, and calculate the NJ portion myself based on my own math? Will this create a problem if NJ is receiving a copy of my W2 from my employer, which would show a different amount attributable to NJ?
If you wish, you can recalculate the state income portion (Box 15) using your own math. If you decide to do so, do not e-file your return because the computers will pick up the mismatch and reject your return. Instead, print your return and submit it on paper. I'd suggest including a note explaining the discrepancy. Also, do not change the amount withheld (Box 17).
I don't think your answer is correct. See guidance from NJ here: https://www.state.nj.us/treasury/taxation/njit24.shtml
According to this, since I have NJ-source income (my rental property) while I was a non-resident, I need to file *both* a NJ non-resident return (NJ-1040NR) as well as a part-year resident return (NJ-1040).
How does one do this in turbotax (desktop version), and how do you make sure that it is calculating everything properly across all the state returns to ensure proper credits?
Your reading of the NJ instructions is correct. Unfortunately I don't have the NJ or NY downloads on my computer (I'm a fellow user, not a TT employee), so I can't duplicate your situation.
The best I can do is again to refer you to this previous TT answer on this problem:
If that suggestion doesn't work, I suggestion posting your problem as a new question. Maybe a NJ-based user will pick up on it and be better able to help.
This is not just a NY-NJ problem, but is a complexity any time a taxpayer moves to a new state but continues to work in the old state. I’m not specifically familiar with the NY & NJ software, but this is how it’s handled in the states I am familiar with.
I assume you had $200K of total wages, not $270K. At the W-2 screen, on the line where NY is in box 15, you change the box 16 amount to $130K. Do not change the box 17 amount. Box 16 of the line where NJ is in box 15, should be $70K. Alternatively, you leave the NY amount as $200K and change the NJ amount to 0 (or deleted the NJ line).
You file a part year resident return for both states. You are going to have to allocate $70K of wages to NJ on the NJ return, but allocate the full $200 to NY on the NY return. So, yes $70K is the double taxed amount.