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    pj007's Avatar
    pj007 Posts: 1, Reputation: 1
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    #1

    Mar 25, 2010, 09:25 AM
    NJ resident commuting to NYC--tax liabilities?
    I am considering commuting from NJ to work in NYC. What taxes will I be responsible for--both NY and NYC taxes? Can you give me an idea numerically of the percentage of taxes I will owe from each state? Thanks.
    ebaines's Avatar
    ebaines Posts: 12,131, Reputation: 1307
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    Mar 25, 2010, 09:34 AM

    As an NJ resident working in NYC you will have to pay NY State income tax on tour NY-source wages. The tax rate varies, but plan on about 6.85% (more if your wages exceed $300K). You do not pay any NY City tax, as only residents of NYC have to pay that.

    You will have to file a NY State non-resident tax return, and then a NJ resident return. On the NJ return you will report all worldwide income, and calculate an initial tax on all income using NJ's rates. Then you take a credit for taxes already paid to other jurisdictions (namely NYS), which will effectively make your tax owed to NJ on your NY wages $0 (or awfully close to it - unless you make more than $500K, at which point NJ's tax rates exceed NY's).

    When you start this job make sure your employer withholds NY income tax, not NJ.
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