NJ readies for battle with NY over work-from-home income taxes - New Jersey 101.5 FM
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New Jersey provides tax credits to residents who pay taxes to other jurisdictions, which is costing the state budget more than $4 billion in foregone revenue a year.
The proposed changes could boost state revenues, provide tax relief to employees of New York companies and encourage more jobs in New Jersey.
They come at the same time Murphy and other New Jersey officials are fighting a congestion pricing toll plan on drivers entering much of Manhattan.
“We’ve been working hard to find solutions so that New Jersey residents, many of whom have been working from home since the pandemic began, won’t face an unfair disadvantage financially,” said Deputy State Treasurer Aaron Binder.
Among them is Pennsylvania, but New Jersey and Pennsylvania have a reciprocal tax agreement in which people pay income taxes where they live, not work.
New Jersey filed a brief in support of New Hampshire’s position.
New Jersey is now proposing to adopt its own “convenience of the employer” rule, so it could tax employees of New Jersey companies choosing to work from home in other states.
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