Hello Sir,

My employer is NJ based, I worked for a client in california from 1st jan 2006 to 5th March 2006 and again I moved to WI and started to work for client from 06 March '06 till date and will be working till end of march 2007.

My employer is holding NJ taxes from my pay checks for all this times.

Should I file for all the state I had been to? Do I need to pay tax for NJ even if I never lived in there?

Thanks in advance for your help.


Mala

Mala:

Are you "home-based" in NJ? In other word, are you maintaining a home in NJ? If so, you must pay state income taxes in NJ as the place where you "live". You will also have to pay taxes to California on the money you earned there and then to Wisconsin on the money you earned there.

You will get a credit from NJ for the taxes you pay to California and Wisconsin, so you will not be double-taxed.

The only way to avoid paying taxes to NJ is to establish residency in another state. You may have already done that in Wisconsin.

I don't have my home based in NJ. But the company I work for or the company which holds my H1B is based in NJ.

Where your employer is located is irrelevent. It is where you live that counts.

In your case, you have established residency in Wisconsin, You will file in both Wisconsin and California, plus file a NJ return to get your wothheld taxes back.

I once lived in NC for part of the tax year, then moved to AL, filed both NC and AL income tax forms, would think you would be required to do the same. The fact that the employer is based in a state where you were not employed has nothing to do with where you file, just file in the states you worked in. Each state will have forms and your taxes will be prorated.

Thank you AtlantaTaxExpert and RichardBondMan.

Glad to help!