Should two states income on W2 sum to Federal Gross Income ?

Apr 09, 2008 2 Replies

Hi,



I worked in 2 states - NJ and IL for the same employer. Following are two entries in my W2:


  1. Under #1 (Wages, tips, other compensation) its 50K
  2. Under #16 (State wages, tips etc) its 41K for NJ and 10K for IL.

PS: I have rounded off figures for simplification.



My question is the combined income of IL and NJ is 51K. But in #1 of W2 its 50K. Is it normal or some error in W2 ?



Thanks dchadha


"D Chadha" wrote

Probably normal. One of those two (or both) states does not allow for the "pre-tax" payment for health, pension, etc type of expenses that the feds do. Does that amount ring up against any single (or multiple) of pre-tax items from your pay?

Or, if you worked in one of those states while living in the other, both states would tax the same income -- in which case the state boxes would add up to more than Box 1.

However, the difference may arise from the fact that NJ taxes employee contributions to retirement plans (other than 401(k) plans) that are not subject to federal tax, so the NJ wages may be higher than federal wages for the same period.

Katie in San Diego

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