15 May I’ve been working overseas. What happens with N.J. taxes?

Q. I’ve been on a work assignment in the UK since Feb 2019. I received pay from my company’s U.S. payroll from February 2019 through March 2022. My company deducted New Jersey taxes from my income. How do I recover this New Jersey taxation money since I am only required to file federal tax returns?
— Coming home

A. Welcome back to New Jersey.

You may have some work to do.

If you were domiciled in New Jersey and maintained a permanent home in New Jersey, then despite being abroad for three consecutive years, the New Jersey Division of Taxation treats you as a New Jersey resident for the entire time period, said Neil Becourtney, a certified public accountant and tax director with Smolin, Lupin & Co. in Red Bank.

“Like any other resident taxpayer, you would need to file a Form NJ-1040 and you would not automatically receive a refund of the New Jersey tax withheld by your employer,” Becourtney said. “For 2019, the three year statute of limitations has expired for receiving any refund you might be entitled to.”

On the other hand, if you were domiciled in New Jersey, did not maintain a permanent home in the Garden State and spent 30 or fewer days in New Jersey in any year, then you would be treated as a New Jersey nonresident for the period you were abroad, he said.

Your wage income derived from services rendered in the U.K. would not be subject to New Jersey nonresident taxation.

Presumably, you were a New Jersey resident prior to the U.K. work assignment, he said.

Assuming you are treated as a N.J. nonresident while on the work assignment, you would have been required to file a part-year New Jersey resident income tax return for January 2019, he said.

“For the N.J. tax withheld during the period February through December 2019, you cannot receive a refund at this point as the three-year statute of limitations has expired,” he said. “For calendar years 2020 and 2021, you need to file Form NJ-1040NR to claim a refund of the tax that was withheld from your wages, again assuming you meet the nonresident taxpayer definition.”

For 2022, you would need to file two N.J. tax returns, a Form NJ-1040NR for January through March and a part-year resident Form NJ-1040 for April through December, he said.

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This story was originally published on May 15, 2023.

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