08 September 2016 Law firm clients: New Jersey governor gives notice to end income tax reciprocity with Pennsylvania, affecting some law firms On September 2, 2016, a spokesperson for Governor Christie advised media outlets that the requisite 120-day notice was given to end the state's reciprocal income tax agreement with Pennsylvania. (KeyStone Crossroads, 9-2-2016.) The move comes in response to Christie's attempt to balance the state's budget, an action he says he will reconsider if the legislature takes action now to reduce public employee health insurance costs. Should Christie not rescind his notice, the New Jersey-Pennsylvania reciprocal tax agreement will be terminated effective January 1, 2017. If so, law firm partners or associates/employees who are Pennsylvania residents and work in New Jersey may have to start paying taxes to New Jersey, which may exceed the amount of tax they are currently paying to Pennsylvania. For details, see Tax Alert 2016-1502.
Document ID: 2016-1515 | |||||||||
