IT-112-R (NJ): Tax Amount - TP should not be greater than the tax imposed by the other state.

[andreyb]

There is a similar thread here where I asked this same questions, but I thought post may get faster  response versus a reply on an old thread.  Forgive me please for double posting.

Link to the old thread:

https://ttlc.intuit.com/community/state-taxes/discussion/it-112-r-nj-tax-amount-tp-should-not-be-gre... 

I live in NY state and work in NJ.  Sometimes I work from home and sometimes from the office.  The company provided me with two W2 forms.  One form lists box 15 as NJ and box 16 has wages attributed to NJ (it's a portion of total income).  State income tax paid to NJ is also provided.  Another form lists box 15 as NY and box 16 has all wages attributed to NY (this is how NY does it).  State income tax paid to NY is also provided.  

I entered NJ and NY information (numbers from W2 are automatically transferred)  NJ checks out fine and NY final check gives me this error.  I don't understand what is wrong as according to W2 I paid more taxes than it was calculated by TurboTax for NJ.    All numbers on the form IT-112-R  seem correct.  Please help.  My code is  1127166

[ErnieS0]

Here’s how to change the other state tax credit

1. In the New York section, go to the screen “Take a look at New York credits and taxes”
2. Select Taxes Paid to Another State under Credit for Taxes Paid
3. On “Other State Tax Credit Summary,” Edit NJ
4. Verify the amounts on “Income Taxed By New Jersey.” These should be correct. If not, enter the correct number in Amount if Different. You may have multiple screens, depending on your tax return.
5. On “Tax Computed on Your New Jersey Return, enter your NJ tax liability in Amount if Different. TurboTax should display the correct amount to enter on that screen.
6. If you don't see the amount, tap Tax Tools in the left column
7. Then Tools
8. Select View Tax Summary in "Tools Center"
9. Select NJ Tax Summary in the left column and find your Total Tax. If you have a shared responsibility payment, subtract that amount
10. Tap Back in the left column to return to the interview mode

[andreyb]

Thank you for your answer.

I followed your steps exactly.  However, the numbers all check out 

Income Taxed by NJ matches W2

Income Tax paid by me also matches W2

Tax Computed on Your New Jersey Return matches what TurboTax calculated in Tax Summary for NJ (Total Tax)

when I go for Review smart check still gives me the same error:  IT-112-R (NJ): Tax Amount - TP should not be greater than the tax imposed by the other state.

Your advise how to address this is highly appreciated.    I made another submission: 1130970

Thank you

[ErnieS0]

TurboTax computed your New Jersey tax liability as $5,565.

[andreyb]

I know.  However, TurboTax is giving me the error above.  It looks like TP is factually  greater that the tax imposed by the other state.  Am I missing something?  Why is there an error?

[AmyC]

You get credit for the lower state tax on the lowest taxable amount.

• Each state calculates taxable income differently. 
• Each state has its own tax rate/ system.
• You get the lowest of both categories as a tax credit.

Ernie notes your NJ tax amount, is that what is showing on the NY credit form to use for the computation? It sounds like a larger number is in there, like maybe withholdings instead of actual tax liability. Please double check your entry for the NJ liability to NY.

[andreyb]

Amy,

Thank you for your answer.  I think we are going around in circles. 

 Again  NY Form IT-112-R (NJ) has the following numbers (calculated and filled  by TurboTax) :

23 -  NJ

23A -  5,565.0  (This is my NJ tax liability amount, calculated by TurboTax ) 

I trust this number is correct (is it not?)

24A  has 6,474.0 ( Which is what was paid by the taxpayer or on behalf of taxpayer )

This is the number from my W2.  Am I correct?

Now, Turbotax complains about 6,474.0  being larger  than the tax imposed by the other state (5,565.0)?

Is TurboTax wrong?    I ended up sending my tax return as is because I can't use any of your answers to correct TurboTax calculations.  

[fanfare]

"This is the number from my W2. "

your w-2 withholding is irrelevant.

if TurboTax is putting that in as your NJ non-resident tax that's a bug.

enter your NJ tax or your NY tax, whichever is smaller, for credit from other non-resident state.

@andreyb 

[ltra922]

Hi I too am going CRAZY trying to solve this.  My wife lives in NY and works in NJ. 

It keeps giving me this error and Im not sure what amount to put in there.

Error is - IT-112-R(NJ) Tax amount -TP Should not be greater than the tax imposed by the other state

[AmyC]

Somehow the form has a number for credit that is larger than the actual tax liability, which isn't allowed. Go back and take a look at the actual NJ tax liability and enter that for the tax liability into NY program.

You get credit for the lower state tax on the lowest taxable amount.

• Each state calculates taxable income differently. 
• Each state has its own tax rate/ system.
• You get the lowest of both categories as a tax credit.

Follow these steps to locate your tax liability for NJ 

1. Log into your return
2. Select state taxes
3. Enter the non-resident NJ  for which you need the liability
4. On the left, go to Tax Tools
5. Select Tools
6. Select View Tax Summary
7. You will see Summary of your NJ Return at the top.
8. Locate the line that says Total Tax

Some states tax income the federal does not. For example: NJ taxes money you set aside in your retirement plan. Each state has different rules. 

@ltra922