TT not calculating proper NJ credit for taxes paid to PA municipality

[DrCCCG]

NJ-COJ, TT puts wrong value in box 9a. Incorrect NJ credit for PA municipal tax paid

NJ resident, worked in PA and had income and tax on W-2 paid to a PA local municipality of several thousand $ (this is the tax paid)

TT calculates the credit on my return as only $106.

Here the issue:

• I've done this for several years in a row with TT and the NJ credit is always the same as the PA municipal tax paid
• I've looked at all the past year's NJ-COJ forms done in TT.  In every year, the value in box 9a is the amount of tax paid.
  • ** I do understand that the ultimate credit is a calculation on this form, and may be less.  But the box 9a is the amount from the W-2 for local taxes paid.   ** note the value in box 9a is supposed to be the value of the taxes paid, per the NJ tax directions.
• I also have non-resident tax in CA and when I look at that NJ-COJ form, box 9a is exactly equal to the tax paid to CA.
• In the NJ-COJ form for the PA municipality credit, box 9a is $106 for some reason.  Why is this?   As this ultimately makes the credit significantly less ($106 rather than several thousand $)

Here's the weird part:

• If I go back to my W-2 and change only the local tax income tax paid (box 19) by ONLY $0.20 (so it rounds up to the next dollar) the box 9a on NJ-COJ for the PA municipality changes from $106 to the correct amount of several thousand $!!   And then I get the full credit!
• Similarly, if i go to the actual NJ-COJ form in TT and use the smart worksheet, i can put the slightly higher amount in Column B / row B (rather than the $1 less amount that is in Column A / row B), and again the box 9a changes from $112 to the much higher amount of several thousand $ and I get the full credit....

HELP.   This makes no sense.

[MarilynG1]

That is strange!  So you changed the amount for Pennsylvania tax withheld in Box 19 of your W-2 by .20 and your full credit was given in New Jersey?  Did you enter the W-2 manually or import?  It could be a rounding issue, but the original $106 credit is a mystery. 

We can take a closer look at this if you're willing to send us a sanitized return (all personal info removed).  To do this, click the ONLINE link at the top and choose 'Send Tax File to Agent'.  You'll get a token number, which is best to post in a screenshot here.  If you just type the number, it may be removed as being a phone number.

@DrCCCG 

[DrCCCG]

Done.   Token number below.      Yes, it is very weird.   

The only tweak to my original statement above.   When I adjust the number on my W-2 by the $0.20 (as described above) the full credit comes in (per the NJ tax due box at the top of TT).   However, when I then go into NJ  state taxes section of TT and update my taxes paid to the PA local municipality for this very slightly higher number, the tax credit disappears again...   so, the problem remains.

Please let me know what you find as the amount is significant (and not sure if others are experiencing this, or would even catch it).    Thank you!

[MarilynG1]

After reviewing your return, the taxes paid to Pennsylvania were Local Taxes in Boxes 18-20 on your W-2.  However, you are entitled to a credit on your Resident New Jersey return for these taxes, but TurboTax does not pick up the amount from these boxes to add to your NJ return as tax paid to another state. 

I made a manual entry in the program to add them on the page titled 'Summary of Taxes Paid to Other States' so Line 43 on your NJ 1040 is now correct. You can also add them in FORMS to New Jersey Form COJ.

@DrCCCG 

[DrCCCG]

So, is this acknowledging that TT does not calculate this credit correctly?  and anyone in this situation would need to catch this issue, and then manually override on this form?

Appreciate the work-around (but seems I need to manually enter slightly incorrect info to make this work), but this also makes me wonder what else I need to check and verify is coming in correctly.   That's a pretty big 'miss' on the software.