Accountant recommendation for NY/NJ
July 13, 2011 9:20 AM Subscribe
I butchered my state income taxes in 2008. New Jersey caught on with an audit, and now I owe NJ a lot of money. I suspect that if I did the taxes correctly, almost all of that money (except for 3 years of interest :( ) would actually come from New York State. Having screwed it up once with Turbotax, I don't trust myself to get it right by hand.
I need an accountant who is familiar with New York and NJ tax issues. Does anyone have any recommendations?
I need an accountant who is familiar with New York and NJ tax issues. Does anyone have any recommendations?
Response by poster: These are just personal taxes. I suppose I can just browse yelp for accountants in Hoboken or Jersey City, but I am in general wary of picking someone without a recommendation.
posted by rrenaud at 9:52 AM on July 13, 2011
posted by rrenaud at 9:52 AM on July 13, 2011
This happened to a friend (NY/NJ taxes too). Turns out, TurboTax caused the fuckup. The short version is something like, there was a deduction that allowed a credit for any amount up to a certain threshold. If you calculate your deduction and it's larger than that threshold, you're still only allowed to deduct that threshold dollar value. Turbotax, however, incorrectly subtracted the entire deduction.
So, first thing, check to see whether it was a TurboTax software error. I'm not sure what my friend ended up doing, but check with TurboTax; I believe if it's a software problem, they have some sort of warranty or guarantee.
posted by lesli212 at 11:58 AM on July 13, 2011
So, first thing, check to see whether it was a TurboTax software error. I'm not sure what my friend ended up doing, but check with TurboTax; I believe if it's a software problem, they have some sort of warranty or guarantee.
posted by lesli212 at 11:58 AM on July 13, 2011
Check with an accountant, sure, but I'm a little confused here. You say that "almost all of that money would actually come from New York State."
Money is fungible, so once a dollar goes into an account, it cannot be said that it is numerically identical to any particular dollar that leaves said account. We may think in terms of "I'm using money I got from this check to pay that bill," but the law generally doesn't think that way.* Basically, if you've got money, the source of said revenue isn't terribly relevant. So if you're just worried that you "spent" all the money you generated in New Jersey, you may not have anything to worry about, because the tax man only cares where money comes from for the purposes of assessing taxes, not collecting them.
*Except in cases where an account is overdrawn. Then you get into LIFO accounting. But that's getting a bit into the weeds.
posted by valkyryn at 12:02 PM on July 13, 2011
Money is fungible, so once a dollar goes into an account, it cannot be said that it is numerically identical to any particular dollar that leaves said account. We may think in terms of "I'm using money I got from this check to pay that bill," but the law generally doesn't think that way.* Basically, if you've got money, the source of said revenue isn't terribly relevant. So if you're just worried that you "spent" all the money you generated in New Jersey, you may not have anything to worry about, because the tax man only cares where money comes from for the purposes of assessing taxes, not collecting them.
*Except in cases where an account is overdrawn. Then you get into LIFO accounting. But that's getting a bit into the weeds.
posted by valkyryn at 12:02 PM on July 13, 2011
I have an accountant who is very familiar with these types of taxes; MeMail me if you want his contact info. Bonus: he's also an attorney and very familiar with tax law.
posted by bedhead at 12:16 PM on July 13, 2011
posted by bedhead at 12:16 PM on July 13, 2011
Response by poster: valkyrn, the problem is that I should have given NJ say, 15k in 2008. But because of user confusion and/or software error, I instead gave NY 15k, and NJ gave me 15K. I am somewhat sure that I paid approximately the right amount of money in taxes, just to the wrong place. Now NJ figured it out, and according to them, I owe them something like 18K (original 15K + interest for 3 years + some fees). So when I amend the taxes to pay NJ, NY will essentially owe me the 15K that I wrongfully gave to them. Of course, I won't be able to collect the interest for that generous loan, nor any fees.
It's not that I can't swing 15K.
posted by rrenaud at 5:04 PM on July 13, 2011
It's not that I can't swing 15K.
posted by rrenaud at 5:04 PM on July 13, 2011
You live in New Jersey, but work in New York? Usually that means New York gets your withheld tax and you get a tax credit from NJ for what you paid to NY, thus reducing your New Jersey tax liability to the difference between the NYS tax rate and NJ's tax rate. If it's the other way around, then you'd pay New Jersey income tax and NYS would give you the credit, thus reducing your liability to NYS.
At least that's how it works in the 3-5 foreign states I have to file in each year.
posted by wierdo at 5:09 PM on July 13, 2011
At least that's how it works in the 3-5 foreign states I have to file in each year.
posted by wierdo at 5:09 PM on July 13, 2011
So when I amend the taxes to pay NJ, NY will essentially owe me the 15K that I wrongfully gave to them. Of course, I won't be able to collect the interest for that generous loan, nor any fees.
Then yeah, you're basically going to have to do amended filings in two states.
This is absolutely beyond the ability of tax software to handle, and you'd be nuts to try and do it yourself. Hit up bedhead for his accountant referral.
posted by valkyryn at 4:20 PM on July 14, 2011
Then yeah, you're basically going to have to do amended filings in two states.
This is absolutely beyond the ability of tax software to handle, and you'd be nuts to try and do it yourself. Hit up bedhead for his accountant referral.
posted by valkyryn at 4:20 PM on July 14, 2011
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Sadly, I don't have any specific recommendations. Are these business taxes or personal taxes? If you've got special circumstances, I'd find a specialist!
posted by schmod at 9:43 AM on July 13, 2011