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June 5, 2019
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I work innew jersey and live in delaware, why is delaware taxing me so much?

  • June 5, 2019
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Best answer by DanielV01

It depends.  When you live in one state and work in another, both states tax you.   You are taxed in New Jersey as a nonresident, and taxed in Delaware as a resident.  Delaware, however, does give you a credit for taxes you pay to another state.  You want to prepare the NJ nonresident return first to assist TurboTax to accurately calculate the credit.

In the NJ return, you want to make sure that any line on your W-2 that is listed as DE in box 15 is not included for NJ taxes.  This way your NJ return is calculated correctly, which may increase your NJ refund.  However, Delaware may tax your income more than what New Jersey does.  If this is the case, and you have not made estimated payments to Delaware, you may still owe an amount to Delaware on your return.

1 reply

DanielV01
DanielV01Answer
Employee
June 5, 2019

It depends.  When you live in one state and work in another, both states tax you.   You are taxed in New Jersey as a nonresident, and taxed in Delaware as a resident.  Delaware, however, does give you a credit for taxes you pay to another state.  You want to prepare the NJ nonresident return first to assist TurboTax to accurately calculate the credit.

In the NJ return, you want to make sure that any line on your W-2 that is listed as DE in box 15 is not included for NJ taxes.  This way your NJ return is calculated correctly, which may increase your NJ refund.  However, Delaware may tax your income more than what New Jersey does.  If this is the case, and you have not made estimated payments to Delaware, you may still owe an amount to Delaware on your return.

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April 14, 2020

So, at the end of the year, after all returns are complete, what would my total state level tax rate be for both NJ and Delaware combined? Say for example I make $70,000 a year and don't have any unusual circumstances.