What NJ adjustments do I need to make for retirement contributions?
Under New Jersey law, contributions to retirement plans other than 401(k) plans are taxable and should be included in your wages on your New Jersey return. This includes plans like 403(b), 457(b), SEP, or any plans that are not 401(k) plans.
Most New Jersey employers will correctly include these taxable contributions in Box 16 of your Form W-2, and we'll prompt you with this correct amount, so no adjustment would be needed. However, if you worked in another state (New York for example), your taxable retirement plan contributions may NOT be included in your state wages and you'll need to adjust your wages so your contributions are correctly included.
Example 1:
Amber lives in New Jersey and works in New York. She earned $50,000 in wages and made $5,000 of contributions to a 403(b) plan during 2025. On her Form W-2, her Box 16 state wage amount shows $45,000 ($50,000 in total wages - $5,000 in 403(b) contributions). This doesn't align with New Jersey tax law. She needs to be sure her $5,000 of 403(b) contributions are included as taxable wages on her New Jersey return. She should adjust her wages to enter $50,000 of wages, so the full amount of her wages and 403(b) contributions are taxed.
Most New Jersey employers will correctly include these taxable contributions in Box 16 of your Form W-2, and we'll prompt you with this correct amount, so no adjustment would be needed. However, if you worked in another state (New York for example), your taxable retirement plan contributions may NOT be included in your state wages and you'll need to adjust your wages so your contributions are correctly included.
Example 1:
Amber lives in New Jersey and works in New York. She earned $50,000 in wages and made $5,000 of contributions to a 403(b) plan during 2025. On her Form W-2, her Box 16 state wage amount shows $45,000 ($50,000 in total wages - $5,000 in 403(b) contributions). This doesn't align with New Jersey tax law. She needs to be sure her $5,000 of 403(b) contributions are included as taxable wages on her New Jersey return. She should adjust her wages to enter $50,000 of wages, so the full amount of her wages and 403(b) contributions are taxed.
