I'm trying to do the math on a pending job transfer to NY City. If I live across the river in Hoboken, N.J. but work in Manhattan:

1) Is it true that I will have NY City, NY State and NJ state taxes witheld?
2) If so, are these taxes applied to taxable income under the same rules as federal income tax rates?
3) Is there no legal way to avoid this triple taxation, even if my company is headquartered outside of NY?
4) When I file my tax return, is it true that I will be refunded the NJ taxes because I paid a higher amount of NY/NYC taxes?
5) If I itemize for federal tax purposes, which state income tax would I claim as a deduction?

Thanks in advance for your help.

AtlantaTaxExpert

1-4) If you work in NYC, but live in NJ, you will owe ZERO NYC taxes (that's for residents of NYC only). You should have NY state taxes withheld, but NO NJ taxes, because NY state tax rates are higher than NJ, and NJ will give you a dollar-for-dollar credit for the taxes you pay to NY state. You still to file a NJ tax return, but you will owe nothing and will get a small $50 property tax/renter's rebate.

5) NY state, as that is the ONLY state taxes you should have withheld.