What do I do if I live and work in NJ for a company based in CT and my company accidentally marked my work location as CT so I paid CT taxes rather than NJ taxes by mistake?

[jhallen4]

I believe I should have been paying NJ withholding rather than CT withholding throughout the year but my company is telling me there is nothing they can do.

[DavidD66]

If you did not work or live in Connecticut, you do not owe any CT tax.  You will have to file a Connecticut non-resident tax return in order to get a full refund of all state taxes they withheld.  You will also file a New Jersey resident tax return.  Since you didn't have any New Jersey tax withheld, you can expect to pay a penalty for underpayment.   

[novakjl]

I have a similar situation.  I am a home office based employee working and living in NJ but the company I worked for has its headquarters in CT.  The company withheld NJ taxes only.  Do I need to file a non-resident CT return?

In addition to my current company in CT, I also received severance payments from another CT-based company while living in NJ.  That company only withheld CT taxes (no NJ taxes).  How should I file those earnings if I was not working for that company any longer, however was receiving severance payments reported as income from a CT-based company?

[TomD8]

@novakjl   --  Did you physically work in CT for the company that gave you severance pay?  

[novakjl]

Yes, when I was an active employee. 

[TomD8]

CT can tax non-residents on CT-source income.

CT law is that CT-source income includes income "attributable to compensation for services performed in Connecticut or income from a business, trade, profession, or occupation carried on in Connecticut."  See page 10 of this reference:

https://portal.ct.gov/-/media/DRS/Forms/2019/Income/Booklets/CT-1040NRPY-Online-Booklet_1219.pdf

Since your severance pay is attributable to work you performed in CT, it is taxable by CT.

[novakjl]

Thank you for the response and pointing me in the direction of the correct rule regarding this income source.  Much appreciated!