What would be the better of two: We are living and working in NYC. Right now we purchased house in PA (with high school taxes). Which would be better tax report wise, resident of PA or NY(we are paying rent in NY)? Our income is approx. 120K.
Are we eligible to receive first home buyer discount? Thanks in advance.

The First Time Home Buyer's Credit of $8,000 has expired; sorry!

Since you live and work in NY state for the majority of the time in the calendar year, you are a NY state resident. You have no choice in that matter.

You are a non-resident of Pennsylvania, but you can still deduct the school taxes paid to PA and the mortgage interest on the PA house on your federal tax return as an itemized deduction.

Thanks a lot!!

Glad to help!