Should i file a PA non-resident return, or claim a credit on my NJ resident return, for PA unemployment withheld from my paycheck?

[shawndean22]

I do not have any PA State income tax withheld, just PA Unemployment Tax. Also this is not showing on W2 form for some reason. 

[AnthonyC · Accepted solution]

You would actually do neither - PA will levy the unemployment tax on you since that is the state where you worked.  What will happen is if you are ever actually unemployed and need to file a claim - you would file the claim and collect from Pennsylvania - not New Jersey.

However, you may be able to claim a deduction for this on your Federal Schedule A if you are itemizing your deductions.  The IRS allows these types of payroll deductions to be deducted as a form of state and local taxes paid.  Since it's not appearing on your W2, you can enter the amount under Deductions and Credits -> Estimates and Other Taxes Paid ->and then enter it as Other withholding not already on W2

[Edited:  1.19 | 10:00AM EST]