Hello,

I am moving to New York City from Pittsburgh. I have questions on the New York city taxes.
1) Will the signing bonus be taxed at New York City tax rate. If yes, how much (%) will that be.
2) Will I save money if I get my bonus now before moving to NY city.
3) I will be living in New York and working in New York. What % taxes (City & State) will I be paying. I will be in the $8k - $11k monthly salary range.
4) How much can I be saving by living in New Jersey

Your help is appreciated.

Thanks.

Once you move to NY City you will be paying NY State and NY City Resident income tax. The NYC Resident tax for you will be $2694 + 3.2% on excess over $90K. You can get more specifics here:
Personal Income Tax (http://www.nyc.gov/html/dof/html/services/business_tax_nys_income.shtml)

The NY State tax rate for you is 6.85%. So in total that's about 10% to the city and state.

You can avoid the NYC resident tax by living some place other than NY City or Yonkers - so you could live upstate, or on Long Island, or in NJ or CT and save the 3.2%. As to how much you would save by living in NJ - obviously the NYC resident tax goes away, but you'd still be paying NY State tax as a non-resident on your salary. If you have other forms of income (spouse's income, interest, capital gains, etc) and lived in NJ then the tax rate on those at NJ's tax rate may be less than if you lived in NY- it all depends on your personal situation. Also, you may find that the cost of housing is cheaper in NJ, but you need to balance that against the cost of commuting, car expenses, etc.

Here's a good site for comparing tax rates of the different states:
Taxes by State (http://www.retirementliving.com/RLtaxes.html)

I live in NJ and work in NY. Do not live in NJ to save money. First, I pay state taxes to both NY and NJ. I live in Hoboken, which is just outside lower Manhattan. The commute is cheap because I take the PATH train (a subway that runs between NJ and Manhattan) which is the same as taking the NYC subway. Real Estate is a little lower than Manhattan, but more expensive than most of Queens or Brooklyn.

If you move further out in NJ your commute will become much more expensive. Also, property taxes are very high. But it will be much quiter and more residential.

I know you asked a tax question, but I thought you might find this info relevant to making a decision.

If you are paying taxes to both NJ and NY, are you NOT claiming the tax credit provided by NJ for the NY state taxes you are paying?

It has been my experience that clients who live in NJ, but earn all of their money in NY pay little or NO NJ state tax due to this credit.