It seems I have very complicated situation-- my own company is located in CA ( my W2-state tax withdraw is CA), but my office is in NY city and we live in NJ, my wife works in NJ.
Can you tell me what exactly the states we should file our tax return and don't get double taxed?

Thanks a lot

You file and pay taxes to NY state but NOT NY city.

You file for NJ and pay taxes on your wife's NJ income. More than likely, the credit given for NY taxes paid will alomost completely offset any NJ taxes owed.

You file for California to get ALL of the withheld taxes back. California has NO LEGAL STANDING to tax your income since you are not physically located there.

Tell your employer to STOP withholding CA taxes, refund the taxes withheld to date in 2008, and START withholding NY taxes. BTW, he has no legal choice in this matter.