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mikjon
Returning Member

What CAFE 125 benefits do I have to manually add into my income for NJ return? I work in NY and have health/dental/vision/FSA/commuter deductions.

 
8 Replies
MaryK1101
Expert Alumni

What CAFE 125 benefits do I have to manually add into my income for NJ return? I work in NY and have health/dental/vision/FSA/commuter deductions.

In general, most cafeteria 125 benefits are taxable income in New Jersey.  The exceptions are very narrow- if you read the link below and can add more details, please add a comment. See NJ Cafeteria Plans.

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mikjon
Returning Member

What CAFE 125 benefits do I have to manually add into my income for NJ return? I work in NY and have health/dental/vision/FSA/commuter deductions.

The link you included does not work. I have health/dental/vision/FSA/commuter... Do I have to add ALL of those to my NJ income?

MaryK1101
Expert Alumni

What CAFE 125 benefits do I have to manually add into my income for NJ return? I work in NY and have health/dental/vision/FSA/commuter deductions.

I updated the link so it should work now.  Please try again and add details if you have questions. 

 

@mikjon

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mikjon
Returning Member

What CAFE 125 benefits do I have to manually add into my income for NJ return? I work in NY and have health/dental/vision/FSA/commuter deductions.

Ok so my understanding after reading the document is that my full 3245 (2600 FSA + 645 Commuter) must be included as income on my NJ return on the "Adjustments to W2 wages" page correct? Should I then also enter 5,174 in my "Medical Expense" deduction for NJ which is for my premiums paid for health/dental/vision? Also, it looks like for NY the CAFE 125 is tax exempt according to my W2 reported wages, however the health/dental/vision are not correct?

MaryK1101
Expert Alumni

What CAFE 125 benefits do I have to manually add into my income for NJ return? I work in NY and have health/dental/vision/FSA/commuter deductions.

The New Jersey add-back of cafeteria plan benefits to Gross Income applies to any of the benefits that were tax-free for the federal income tax.  If the Health/Dental/Vision were not included as part of the cafeteria plan you would not add those back.  For example, many employers offers the health insurance to everyone and pays a portion and you pay part of the premiums pretax.  Some allow the premium portion for the employee to be paid by their cafeteria plan- this would be included.  (Look specifically for the benefits you received in the plan.)  @mikjon

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KarenJ2
Expert Alumni

What CAFE 125 benefits do I have to manually add into my income for NJ return? I work in NY and have health/dental/vision/FSA/commuter deductions.

Generally your payroll department would add back pretax items like HSA contributions to your NJ wages when your W-2 is printed.  You can confirm that with your Company payroll department.

 

If your employer added the HSA contributions back to state income in box 16 of your W-2 , then you do not need to add this amount on your NJ return.

 

For federal purposes, HSA contributions made through the employer, are removed from wages in box 1,box 3 and box 5 of your federal wages. 

 

 

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mikjon
Returning Member

What CAFE 125 benefits do I have to manually add into my income for NJ return? I work in NY and have health/dental/vision/FSA/commuter deductions.

Hi thanks for the feedback. I am sorry but I am confused since my W2 is printed for NY state income tax not NJ. For NY the reported wages is matching my Federal, which excludes the full cost of my health/dental/vision/fsa/commuter. I am still confused if I should be adding just the FSA amount of 3,245 to my NJ wages while at the same time including the 5,174 on my medical deductions for NJ?

JosephF8
Expert Alumni

What CAFE 125 benefits do I have to manually add into my income for NJ return? I work in NY and have health/dental/vision/FSA/commuter deductions.

Yes you would add back those CAFE 125 benefits back in for NJ.

You would then take all your Medical expenses as a deduction.

This includes premiums paid on your NJ return.

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