PART YEAR NEW YORK AND NJ

[mohan]

I have a client, tax payer and spouse both live in NY until March 01, and both has income only source of NY state income. They moved to NJ from March 01 and until Dec 31, 2023. Both tax payer and spouse W2 did not property allocated resident period and non resident period.

For NY state they show full, city shoes only two months and NJ show 10 months during resident period.

When I did part year resident of NY and income source from NY, NY calculate tax on all income sources from NY. 

When I did NJ tax return for part year, they calculate their tax based on resident period of income they received from new York from March 02 to December 31, 2023. NJ also calculating tax on that period. and no credit coming up on income they paid taxes on New York. It's look like double tax. Is it correct?

NJ not computing any tax credit that client paid in NY?

I don't think my client will double tax for same income for both the states? I am using ProSeries Professional.

Please give idea from your practical experience and as per law on this situation.

[Skylane]

Start here:

1. Complete Part XI of Federal information worksheet including state residency status and dates.

2. use Quick Zoom to Part Year Resident State Allocation worksheet and allocate the wages, etc. 

3. on NY information worksheet PART II select Part year resident IT203... you'll have to do some allocating here too but if you follow the error flags the program does a pretty highlighting fields that need to be addressed... 

4. When you clear the errors then try NJ.  (Note; be sure to check the wages in NJ box 15  are correct.  Depending on how the W2 worksheets are completed, the wages that transfer can double.... if that's the case double click on line 15 to get to statement for wages, salaries.... THEN enter income attributed to NY PY Res .... OR you can double click on income from all sources (line 1) to get to total wages worksheet where you can exclude duplicate state wages (often times NY state taxable wages differ from NJ taxable wages b/c NJ taxes cafe125s, 414h, and lots of stuff that IRS and NY do not. 

[olsenpearlolsen]

I believe in that situation you have to manually put the income in that is being taxed by both states and then allocate the amount of tax NY is charging.  I would use a percentage of total income and total tax and then multiply the tax times the rate of the income was earned while a resident in NJ to come up with the tax.  That will get it to work, but I am not sure how to get the program to do the calculation itself.  I believe you ahve to put the numbes in yourself to that schedule.