My husband works in NJ and lives in the Bronx. WE went to get our taxes done but now owe NJ money because tax guy said they didnt withhold NJ non-resident tax (they didn't). My husband asked his employer today and they said that what we pay to NY state tax should have covered this. Does anyone know?

delite

You have to file a New Jersey nonresident return for income earned in NJ. Also must file NY. NY will give a credit against for taxes paid in New Jersey.

nicoleusb02

Thanks, but we did file both a NJ non resident return and a NY return. We owe $1200 to NJ now! He paid taxes at a single rate and got 0 deductions and we still owe to NJ? I dont understand why? Everyone I am asking is saying that I shouldnt owe NJ anything and if I do it should be like $50 because they did take out so much NY tax. Should we have paid both NY and NJ taxes?

AtlantaTaxExpert

Your boss is mistaken. He is thinking you will get a credit on your NJ tax return for NY taxes paid, and it does not work that way. NY gives you a credit for NJ taxes paid if you work in NJ and live in NY.

The converse (work in NY and live in NJ) is probably what your boss is thinking about. Under those circumstances, you would pay NY and the NY tax, being a higher rate, completely offsets whatever you may have owed to NJ.

nicoleusb02

This totally helps. Thanks so much!

AtlantaTaxExpert

Glad to help!