"Total income on W-2" on NJ state return is incorrect?

[elipb123]

My W-2 information is correct in my federal returns, and it was correct in my NY state returns. However, on the Tell us about you New Jersey income page, my Total income is wrong, and I can't edit it.

[DanielV01]

What is it showing between Fed, NY and NJ?  I can assist you to fix this, or at least understand it.  Do you live in NJ or work in NJ?

[elipb123]

I live in NJ, work in NY. Fed and NY are the same dollar amount but NJ lists a higher number.

[elipb123]

It gives me an option to remove state wages in the page before, but I've tried all combinations of removing state wages and nothing gets me to the right W-2 income amount

[DanielV01 · Accepted solution]

Remove NY.  It is common that the income in NJ might be slightly higher than what is listed for your Federal and NY returns.  NJ considers a few things to be nondeductible, such as a Cafeteria 125 plan (for health insurance) as well as contributions to a retirement plan that is not a 401(k).  If the NJ income reports slightly higher than NY and Federal, it is correct reporting.

What you don't want to see is NJ doubling up the income.  If you do not selct the "Remove NY" line, NJ adds both the NJ and NY lines together, which results in much higher income and tax.

On the NJ return, you will later see a section regarding taxes paid to another state.  In that section you will receive a credit for the tax you pay to New York on double-taxed income, that is, the income that New Jersey taxes you as a resident of NJ and that New York taxes you as someone working in New York.

[elipb123]

You are a lifesaver! Thank you Daniel!!

[DanielV01]

You're welcome.

[sachinarora3]

Same problem. How do I remove NY? 

[MarilynG1]

Click the link for instructions on how to remove a state return from TurboTax Online.

This link has instructions on how to remove a State Return in TurboTax Desktop.

@sachinarora3

[Heimmi]

Daniel, 

I am having the same problem. I live in NJ but also need to file in MA, HI and Rhode Island. I did the NJ return last and it is still double counting the income earned in other states. Help?!

[KrisD15]

If you are a resident of New Jersey, you are tax on all your income, no matter where you earned it. (EXCEPT for Pennsylvania) and you do not get credit for taxes paid to another state. 

So if you live in New Jersey and you work in a state that taxes income earned in their state, you get taxed twice. 

New Jersey State

@Heimmi

[Heimmi]

No, the income showing on my NJ return per turbo tax is higher than I earned in the year aka higher than my gross income 

[MaryK4]

New Jersey taxable income includes amounts not subject to federal income tax, most notably contributions to pensions and tax-deferred annuities and employee contributions to federal Thrift Savings Funds, 403(b), 457, SEP, or any other type of retirement plan other than 401(k) Plan.  

[mbinnj]

After using TurboTax for many years, we found that the 2019 edition incorrectly doubled my 401 contribution, which is tax-free on the federal wages, but taxed by New Jersey.  My W2 properly calculated the Box 16, state wages as Box 1 Wages (federal reporting) + box 12, code D (elective deferral 401) + box 14 code V non-taxed health benefits.   Both are taxed by NJ, hence the need for box 16 on the w2.

Turbo tax added the amount entered from box 12 code D again, resulting in a state wage greater than my salary. Turbo tax does add a note in the state section "other wage adjustments" to ask you to check it, but it past years this seemed to be correctly calculated.

[msliming]

Hi,

I'm trying to complete my tax return from 2020.  I lived in New Jersey and California during the year.

My California and federal return is correct but my New Jersey return is not picking up income from both W2's.

it picks up the income from the second W2 only.  How do I fix this?  I'm using Turbo Tax Amend on the desktop.  I'm filing my original return but that was the only software available for download.

Thanks,

Maggie