File part-year New York and Pennsylvania returns, but report all your income on your New York return. It’s all taxable to New York.
File a part-year PA return and report only the income you earned from September. You’ll have to pay both state and city tax, but you’ll get a credit (for state purposes) for tax paid to NY.
You’ll have to split your income for the NY return.
- On Tell us about your New York resident income list the amount you earned while “living” in New York (January through August).
- On Tell us about your New York nonresident income include the rest of your income, as it was New York source income earned while living outside New York.
Since your employer stopped withholding NYC tax, Box 18 of your W-2 is probably the same number you should use as your NY state resident amount.
On your part-year PA return, report the income you earned from September to December. You can claim a credit for tax paid to NY. You’ll have to manually figure the credit since you were not a full-year tax resident.
The credit will be the NY tax on the NY nonresident income (NY nonresident income/total NY income x total NY tax). The PA income will be the NY nonresident income portion. For example, if you made $100,000 total and $25,000 in PA, the PA income is $25,000 and the amount of NY tax available for the credit is 25% ($25,000/$100,000 x NY tax on the NY return).
The NY tax rate is higher, so you should not owe any PA tax on your NY income. However, you do have to file a PA return to report your income and claim the credit.
Prepare your NY part-year return first, then your part-year PA return.
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