State Return: Business Income - Adjustments

[grizz2]

In NJ state return, under Business and Farm Income - Adjustments, it says "to adjust this income to confirm to NJ tax law, enter the following additions: Amount deducted for taxes based on income, Qualified contributions to a self-employed 401(k) plan", etc. Why does this information not pull from the federal return? Where do I obtain this information to input here? 

[MarilynG1]

Did you subtract Federal business expenses for:

• income taxes
• interest received from other states
• 401 contributions (retirement savings)
• IRS section 199
   

If you didn't have these expenses (I'd be surprised if you did), enter 0 for each category (or leave blank).

Here's more info on New Jersey Business Adjustments.

@grizz2 

[grizz2]

@MarilynG1, I did contribute to SEP but I didn't subtract it as an expense.  Under what circumstance would that occur? I just don't understand why this question would be asked. 

Thanks for your time!

[AliciaP1 · Accepted solution]

Since NJ does not treat these items as an allowable business deduction, the question is asked to ensure you don't have something entered in a different place than the specifically identified areas that needs to be adjusted.  If you entered your SEP contributions in the self-employed retirement section you do not need to enter any adjustments for these items.

@grizz2 

[MarilynG1]

If you had deducted your SEP Contribution as a Business Expense on your Federal return, you would need to add it back in for New Jersey, as they don't allow the deduction. 

@grizz2 

[grizz2]

I will look at that @MarilynG1. Thank you!