W2 - NY & NJ Tax

[krish1]

Hi,
I work for an employer with offices in NY & NJ. I am based off of their NJ office. Since I worked sometime in NY, my bonus amount in 2021 had some NY component in it that warranted a NY state W2. I am using TurboTax. Following are some hypothetical numbers for my questions below with regards to filing the returns with TurboTax

1. Federal W2 - Box 1 (Wages, Tips, other comp) - says $1,50,000
2. NY State W2 - Box 16 (State Wages, tips, etc) - says the same number as Box 1 - $150,000
3. NY State W2 - Box 17 (State Income Tax) says $3000
4. NJ State W2 - Box 16 (State Wages, tips, etc) - says the same number as Box 1 - $150,000
5. NJ State W2 - Box 17  (State Income Tax) says $5000
6. My employer emailed a word document saying that my NY taxable wage (NY portion of the bonus) - $9000

Questions -

a. In the NY Tax return, I believe I have to mention the income that is earned in NY. It will be $9000, but I only have the word document as proof. Is that sufficient ? I mean if it is not mentioned anywhere in W2, can I still report the $9000 as NY income (in the place where TT asks for the NY Income amount)

b. While doing my NJ taxes, will my state wages be $150,000 as in (4) above or will it be $150000 - $9000 (the NY portion of the bonus) = 141,000 ? If so where should I edit ?

c. I worked in NY for 299 of the 365 days. The % of days worked in NY comes to 81.9178% However while filling the NY State tax, it allows only 2 decimals, which is 81.92%. It throws off the actual NY portion of the bonus by a dollar or so. Is that ok ?

Thanks

[ErnieS0 · Accepted solution]

New York requires employers to report total wages in W-2 Box 16. However if your employer said you made $9,000 in New York then you can allocate your wages in the New York section.

Your NY income may not match what your employer is reporting if you are allocating by days. That's fine. You can also allocate by percentage.

New Jersey residents are taxed on income earned anywhere so your will report all your income. You can claim a tax credit on the NJ return for the double-taxed $9,000 and tax paid to NY on that amount.

[krish1]

Thanks. Are you saying that there is a way to enter the actual NY amount (instead of a percentage of gross amount) ? If so, how do I do it in TT.

As mentioned above, my employer mentioned a flat NY amount, instead of a % or number of days. But since I did not find a way to enter the actual NY amount in TT, I resorted to calculating and using % 

[RaifH]

You can enter the exact NY amount by changing the Box 16 amount for NY to the amount your employer reported as the correct NY amount. You may also allocate by the number of days or a calculated percentage of the total amount using the allocation screens in the NY nonresident return. If it is a few dollars off, that is fine, as long as all your income is being taxed by your resident state, which we are assuming is NJ. 

If your employer has your entire wages as the Box 16 amount for both NY and NJ as it appears they do from your original post, make sure that when you are doing your NJ return, you only report these wages once. You do this on the screen that says Let's Confirm Your Taxable State Wages. Remove the NY wages. The NJ wages remaining should be at least as much as the federal wages reported in Box 1, possibly more as NJ does not allow deductions for contributions to a retirement account. If you do not remove the NY wages, they will be double-counted on the NJ return.

[krish1]

Got it thanks.

Have a couple of follow up questions

1. The NJ Returns asks this - Did anyone other than your spouse occupy and share rent with you for an apartment or other rental dwelling unit ? 
I only had me, my wife and my minor child in the rental apartment. Does my child count as someone other than my spouse ? What should be my answer ? 

2. Since only one of us (Married filing jointly) had a New york income, TT said I need a certification (I believe IT 203-C). If I e-file, should this certification be sent by post ?

Thanks

[ThomasM125]

Your child did not share rent, so you would indicate that no one other than your spouse occupied and shared rent for the dwelling unit. You would need to mail the IT-203-C form, since it has to be signed separately from your tax return.

[krish1]

Also, For NY - I see a bunch of forms that TT generated (in addition to IT-203) that includes -

1. Star Credit Advance Payment Reconciliation (IT-119) - I did not get this payment (Answered No) but still TT generated it. Any reason ?

2.  Claim for Child and Dependant Care (IT-216). Again I did not have any money spent for Dependant care. Why does TT generate it ??

3.Underpayment of Estimated Income Tax by Individuals (IT-2105.9). I was entering my NY percentage of income incorrectly first for which TT said I owe an underpayment penalty. After entering the correct %, I am now getting a refund from NY. Shouldn't TT have removed this form, now that I get a refund  from NY?

4.Annualized Income Installment worksheet (2105.9). I this this is again related to my underpayment and I clicked on Annualizing in TT. Same question applies. Shouldn't TT have removed this form, now that I get a refund from NY

5.Non-resident or Part year resident spouse's certification (IT-203C). This is ok since only one of us got NY wages

Thanks

[ErnieS0]

Did you claim child care expenses last year? TurboTax may have carried over this form.

You can delete Form IT-2105.9 and the annualized income installment worksheet.

1. Click Tax Tools in the left column
2. Click Tools
3. Select Delete a Form in Tools Center
4. Scroll down to the appropriate forms
5. Click Continue With My Return in the lower right when you are finished

[bozaya]

Thank you for this!