Should TurboTax Deluxe automatically have credited taxes paid to Philadelphia from NJ-1040, line 43? W-2 shows almost $800 paid to Philadelphia, PA.

No. You have to enter the credit manually for Philadelphia Wage Tax paid because Philadelphia is a city so it’s not automatically calculated by TurboTax.

To receive credit for Philly wage tax:

• Click State in the left column
• Click Continue on Let's get your state taxes done right
• Click Continue next to New Jersey
• Keep going until you reach Credit for Taxes Paid to Another State. Click Work on Credit
• Select Pennsylvania as State or Jurisdiction. TurboTax says For Philadelphia (or another Pennsylvania taxing authority), select "Pennsylvania". Continue
• Enter Philadelphia for Name of City, Town, Jurisdiction or Municipality. Continue
• Enter your Double-taxed income and Tax paid to Philadelphia. Philadelphia wages (W-2 Box 18) may be higher than your NJ wages because Philadelphia taxes 401(k) contributions so you may have to adjust the double-tax income and tax paid to Philadelphia amounts.

Learn more at Credit for Income Taxes Paid to Other Jurisdictions (Wage Income).

Thank you for the direction. This must be particular to the on-line software. The CD version I've used in the past did it automatically.