Hi, I work in NJ but live in NYC... I know I have to pay both state taxes but I'm not sure if I was mis-informed when I took this job in NJ... I was told that I would get back most of the NJ State taxes that I pay during the year. However, I just got my 2007 taxes done yesterday and I am only getting back $180 from NJ, of the approximate $1450 in taxes I paid during the year. I have spoken to colleagues who also live in NYC and work in NJ and they told me that they get back about 80% of the NJ State taxes that they pay during the year. So now I don't understand why I am only getting back about 10% when they all get back about 80%! Is this the fault of my accountant or due to my filing status (single, claim 0) or some other factors that I am not aware of? Any help would be greatly appreciate because I am really upset by this. Thanks! Li

On your NYC tax return, you will claim credit for the taxes paid in the NJ.

Your accountant should have completed the NJ Non-resident tax return, which basically taxes you at NJ's rates on your salary earned in NJ. He should also have prepared a NY State resident return for you, which will give you a credit for the taxes you pay to NJ, but because NY State's rates are a bit higher than NJ's, you will most likely end up having to pay a bit more to NY State. Finally, as a NYC resident you also have NYC resident tax.

I don't understand how your colleagues get 80% of the NJ tax withheld back, unless they have had way too much withheld during the year, or unless they make only a small amount of money.