I worked in NY for part of 2019.
I worked in the private sector (not for any government/public entity).
My spose worked in NJ as a teacher for the entire year. Has for years.
We lived in NJ all of 2019 and have so for years.
As a teacher, my spouse has a 414(h) contribution that shows up in Box 14 on the federal W-2.
I chose "Other - not on above list" in the Box 14 Tax Category field when classifying my spouse's NJ 414(H) item.
For some reason, my spouse's NJ 414(h) item is preventing us from submitting NY state taxes by e-file.
This 414(h) is purely NJ related (NJ employer and NJ resident). This makes no sense.
Just to see what would happen, I tried " NY IRC 414 (h) NY tax exempt" in the category field for this 414(h). Not surprisingly, Turbo Tax would not let me keep this selection in the categor field of my spouse's W-2, probably because NONE of her income came from NY! And I made sure my W-2 does not have anything in Box 14 related to state employee retirement. I work in the private sector.
Why is this blocking the e-file? Why does turbo tax provide this message:
"Public employee retirement contributions must be categorized as either subject to tax or tax exempt. The only valid tax category entries for public employee retirement contributions on W-2 box 14 are either 1) NY IRC 414(h) Subject to NY tax or 2) NY IRC 414 (h) NY tax exempt. Other - not on above list is not acceptable for e-file in NY. In most cases, public employee retirement contributions are subject to tax. Review all W-2 Box 14 entries on your Federal return in the Wages and Income Section. If you do not see the tax category box next to the box 14 amount field then click Continue and on the next screen click Back.
These rules are set by the New York State Department of Taxation and Finance."
There seems to be a glitch in the software with classifying the 414(h). And it's blocking NY state's preferred method of tax filing (e-file) as stated in the Turbo Tax review and filing process.
