Is living in NJ and working in Philadelphia better than Living in Philadelphia and working in Philadelphia?
I just started a job in Philadelphia and I currently have my official address in NJ. I know Philadelphia has its own tax, so what will cost me less, living in NJ while working in Philadelphia or living in Philadelphia and working there? I know that if I live in NJ I have to pay Philly, PA, and NJ taxes as opposed to just Philly and PA taxes if I live in Philly. Depending on the percentages of each tax, what will cost me less? I am in the 60K to 70K bracket. Any help would be much appreciated.
United States - 2 Answers
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1 :
if you work in Philly - you will have to pay the Non-residence tax. You won't get any state tax withheld, but you get credit towards the NJ state tax for the Philly tax you pay- it's called a reciprocal tax agreement. If you live in Philly and work in Philly, you will pay the Philly residence tax (which is about 4/10% higher than the non resident tax) AND you pay PA state income tax - 3.07%. - go to paycheckcity.com to calculate paychecks
2 :
If you live in NJ and work in Philly, you don't pay PA income tax. PA and NJ have an agreement where if you work in one state and live in the other, you only have to pay the one where you live. So you'd pay Philly non-resident and NJ. If you both live and work in Philly, you pay PA and Philly resident. If you live in PA, outside of Philly, and work in Philly you pay PA and Philly non-resident. The least expensive for taxes especially at your incove level is usually live in a PA suburb, if you're going to work in Philly.
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I just started a job in Philadelphia and I currently have my official address in NJ. I know Philadelphia has its own tax, so what will cost me less, living in NJ while working in Philadelphia or living in Philadelphia and working there? I know that if I live in NJ I have to pay Philly, PA, and NJ taxes as opposed to just Philly and PA taxes if I live in Philly. Depending on the percentages of each tax, what will cost me less? I am in the 60K to 70K bracket. Any help would be much appreciated.
United States - 2 Answers
Random Answers, Critics, Comments, Opinions :
1 :
if you work in Philly - you will have to pay the Non-residence tax. You won't get any state tax withheld, but you get credit towards the NJ state tax for the Philly tax you pay- it's called a reciprocal tax agreement. If you live in Philly and work in Philly, you will pay the Philly residence tax (which is about 4/10% higher than the non resident tax) AND you pay PA state income tax - 3.07%. - go to paycheckcity.com to calculate paychecks
2 :
If you live in NJ and work in Philly, you don't pay PA income tax. PA and NJ have an agreement where if you work in one state and live in the other, you only have to pay the one where you live. So you'd pay Philly non-resident and NJ. If you both live and work in Philly, you pay PA and Philly resident. If you live in PA, outside of Philly, and work in Philly you pay PA and Philly non-resident. The least expensive for taxes especially at your incove level is usually live in a PA suburb, if you're going to work in Philly.
Read more other entries :
About when you get an email from an IRS employment...
