My W-2 from LTD carrier (paid by my former employer) got Third Party Sick Pay checked. The taxable amounts for federal and state are the same and larger than 0. TT 2022 is telling me that NJ does not tax Third Party Sick Pay.
What is the correct way to reconcile conflicting information between W-2 and TT ?
Third-party sick pay is not taxable in NJ. It is taxable on the Federal return, which is why you see information in Box 1, but the sick pay shouldn't be included in box 16 (you might have to contact the issuer to get this corrected). Please make sure on the W2 screen in TurboTax to check the Third-Party Sick Pay box so that it is excluded from your NJ income.
"Temporary disability (including family leave insurance benefits) received from the State of New Jersey or as third-party sick pay are not taxable." (NJ.gov)
Please see Is third-party sick pay taxable? for additional information.
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