For some time now I've been thinking of making a career move. I live in New Jersey, I am looking to work in New York City and would like to know how would filing taxes affect my weekly pay. For instance would both NJ and NY tax me. How does this work?

Maralyn1004:

Technically, both states will tax your salary, and you will have to file tax returns with both NU and NJ.

In practice, however, you will pay zero taxes to NJ, because NJ gives you a credit for the taxes you pay to NY state. Since the tax rates in NY are somewhat higher than NJ, the credit usually completely negates the NJ tax obligation.

If you take the job in NY, have only NY taxes withheld from your income. As noted above, you will have to file a NJ tax return, but you will owe no taxes. In fact, due to a property tax/renter's rebate, you will probably get a small refund. When you file the returns, attach a copy of the other state's tax return to show the state that you are subject to taxes by the other state.

I am available to help you in this process. I have a number of clients in the NJ/NY area who use my services whom I have never met. They send me their tax information via e-mail, fax and phone. I prepare the returns, send them copies for their personal file, and efile the returns with one of the states and the federal government. The second state's return is mailed in. You will find my rates to be very economical compared to what you would pay a tax professional in the NJ/NY area. I can provide references from these NJ/NY clients, if necessary. If you are interested, contact me at [email protected].

My husband has a similar situation. He will be working in New Jersey but we live in manhattan. How should he handle his withheld taxes from his weekly paycheck and how does that influence his annual income? If you could give a percentage of what we can calculate will be taken out from each paycheck that would be great...
Thanks
Pauline z

Pauline Z:

I am sorry, but that kind of detailed analysis is something I do not do for free.

However, I can say that your situation is the reverse of Maralyn1004's, in that your residence is in NYC but the work location is in NJ. NY will issue you a credit for the NJ taxes, but it will not be enough to completely offset the NY state taxes. For this reason, your husband should have the full amount withheld to cover NJ taxes (by claiming only one exemption), but have a smaller withheld for NY state taxes (by claiming, say, four exemptions) on the state forms that are the equivalent to the IRS W-4.

NYC will not offer any credit for the NJ taxes, so he should claim only one exemption for NYC.

This is for tax filing for 2013. My wife joined a firm in NY in December 2012, have received a month of NY state Salary, while other 11 months worked in NJ.Also my husband works in NJ and we both live in NJ. Hoes does the tax implication particularly when filing with NY state. Will my husband's NJ salary and my portions of 11 months NJ salary included in NY TAXES?

Thanks,

The NJ income is included in the NY state tax calculations to determine the tax rate, but only the NY state income is taxed.