Question

DC resident working in NJ

Forum|Forum|4 years ago
May 13, 2022
1 reply
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Hi. So this scenario is sort of the opposite than usual, with people often coming into DC to work.

I’m a DC resident (license, car registration, etc.), but will be in NJ for work for 6-8 months starting this month. My partner works and lives in DC and is staying there, and that’s where I’ll be returning after this stint in NJ (same address as my license and I’m on the lease…DC is my “domicile”?).

The company has multiple locations and my permanent spot should be one of the DC offices after this training program. Of course I’m not commuting from DC so I’m also renting a NJ apartment. Where will I pay income tax? It should just be NJ withheld, right? And then I’ll only pay DC tax for what I earn while physically working in DC? I just want to make sure I don’t somehow get double taxed (if that’s possible). Thanks!

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T

TomD8

Employee

As a DC domiciliary resident, all your income is taxable by DC, regardless of where you earn it.

In addition, income you earn from work actually (physically) carried out within NJ is taxable by NJ. So you will have to submit a non-resident NJ tax return in addition to your resident DC return.

You will be able to claim a credit on your DC return for the taxes you pay to NJ, so you won't be double-taxed.

You should have your employer withhold NJ taxes from your NJ income. That's because the "other state credit" may only be taken on your DC return.

When using TurboTax, be sure to complete the non-resident NJ return before you do your DC tax return, so that the program can calculate and apply the credit correctly.

**Answers are correct to the best of my ability but do not constitute tax or legal advice.