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Vasiliosthegreat
Returning Member

Working in MD, living in NJ

I am filing my state taxes and for some reason my NJ state taxes are accounting my MD Gross income in the total NJ gross income. So when I go to file, it shows that I owe instead of receiving a return. How can I adjust the gross income for my resident NJ tax return?

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2 Replies

Working in MD, living in NJ

did you add and prepare your MD return before you did your resident return ?
It's important.

rjs
Level 15
Level 15

Working in MD, living in NJ

Since you are a New Jersey resident, all your income is subject to New Jersey tax, no matter where the income is from. Your New Jersey Gross Income (Form NJ-1040 line 29) includes all your income. You cannot adjust that.


Have you completed your Maryland tax return? You should complete your nonresident state tax return before your resident state tax return. You should be getting a credit on your New Jersey tax return for part or all of the tax that you pay to Maryland. The credit is the Credit For Income Taxes Paid to Other Jurisdictions on Form NJ-1040 line 42. If you have not completed your Maryland tax return, the credit should appear on your New Jersey tax return after you complete the Maryland return. If not, go back to the Taxes and Credits section for New Jersey in TurboTax and go through the topic "Credits for Taxes Paid to Another State."

 

Even with the credit for the Maryland tax, you would not get a refund from New Jersey if you did not have any New Jersey tax withheld, or make estimated tax payments to New Jersey. A tax refund is a refund of excess tax that you paid during the year. If you didn't pay any New Jersey tax during the year, there is nothing to be refunded.

 

There are two reasons that you might owe New Jersey tax, even with the credit for the Maryland tax. First, if you had any other income besides your income from Maryland, you would have to pay New Jersey tax on that other income. Second, the purpose of the credit on the New Jersey tax return is to make sure that you do not pay more New Jersey tax than you would if all your income was from New Jersey. But if your Maryland tax is less than you would have paid on the same amount of New Jersey income, you have to pay the difference to New Jersey. If you have any New Jersey tax at all, and you did not have any New Jersey tax withheld or make estimated tax payments to New Jersey, then you have to pay all your New Jersey tax when you file your tax return.

 

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