PENNSYLVANIA PA Taxes Improperly Withheld for NJ Residents

RECIPROCITY An agreement between Pennsylvania and New Jersey Withholding should be in the state where TP resides not the state where TP works Can do only for PA State wages –CANNOT do PA Municipal (e.g. Philadelphia) wages (Out of Scope) Any other income from a reciprocal state is Out of Scope

Wrong State withholding Do e-file of NJ and Federal return as usual Prepare a PA return for TP refund of PA withholding (paper only) Note: Advise TP to talk to employer about correcting future PA withholding.

Federal No adjustments needed

PA Return (PA-40) PA Paper Return Preparation –0 (zero) on line 1a wages –PA State Taxes withheld line 13 –Refund is withholding amount Include in envelope to PA –Copy of W-2 –Copy of NJ tax return (no supporting forms or schedules needed) –Statement explaining TP is resident of reciprocal state

New Jersey Wages are amount reported on line 16 of W-2 for PA Withholding is 0 (zero) Finish return as usual