My office is in NJ and I live in NY. But I worked from home in NY most of 2020 due to the pandemic. Should I allocate my NJ wages to NY?

Forum|Forum|5 years ago
April 12, 2021
1 reply
0 views

I usually work in NJ and live in NY. Due to the pandemic, I have not worked in my NJ office since March of 2020.

When I do my NJ taxes, in my NJ Income Allocations, should I allocate most of my NJ wages to NY (say 70% NY wages/30% NJ wages) ?

Best answer by DMarkM1

Not quite. NY is your resident state. There is no allocation involved there. You are taxed by NY on all income from all sources by your resident state. The non-resident state in this case NJ is where you get to allocate and in your circumstance that would be 100% of your wages allocate to NJ and then you get a credit on your NY return for the taxes paid to NJ to mitigate the double taxation on those wages.

MAK70

Yes, you can allocate based on where you did the work.

New Jersey sourcing rules dictate that income is sourced based on where the service or employment is performed based on a day’s method of allocation. However, during the temporary period of COVID-19 pandemic, wage income will continue to be sourced as determined by the employer in accordance with the employer’s jurisdiction.

icerainerAuthor

Thanks! Just to confirm, due to the special Covid situation in 2020, I should file wages 100% NJ income as if I worked in the NJ office the whole year and get a credit on my NY return. Non of the wages would be allocated to NY income.