Working out of state

BishopJohnson111
BishopJohnson111 Member Posts: 11 Newcomer
in Income

Hi,

In 2024 when I still lived and worked out of state in January and February, I earned money at a job and they sent me a W-2 form for most or all of what I earned, $6,192.35, also a family member gives me money very frequently to help support me, but maybe part of the time to pay me for chores maybe no more than $4,000 or maybe less in 2024.  Without having them to go through the trouble of giving me a W-2 form, can I file ELECTRONICALLY on FreeTaxUsa for IRS and the State of NJ, reporting the income all by myself and paying both taxes their portion and mine?  If so, how can I do this?  I did read online about Form 4852, that may be for at least if not only the IRS.

Please advise me correctly.

Thank you

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Answers

  • JanaA
    JanaA FreeTaxUSA Agent Posts: 89

    Hello BishopJohnson111,

    You’ve raised a couple of questions, and I will respond to each separately.

    Employment Income

    In our software you will simply enter the W-2 as it is listed on your form. If you lived in one state and worked in another, your income may be taxable in both states. It depends on the states involved and if they have a reciprocal agreement. We have a great article you can reference for additional information.

    If your states do NOT have a reciprocal agreement, you may need to file a non-resident return in the state you worked to report the income from this state.

    Additionally, your income will also be taxable in your resident state. To help with this possible double taxation, you can get a credit on your resident return for taxes paid to the other state.

    This process can be complex. We have another article that you can use for reference. If you have questions about this process, please contact our support team while signed into your account. This will provide our agents with secure access to your information so that they can better assist you in determining the best course of action for your specific situation.

    Income Received from a Family Member

    Depending on the nature of the payment, there are a couple of possible tax treatments:

    1. Gift

    • The IRS defines a gift as any transfer to an individual, either directly or indirectly, where full consideration (measured in money or money’s worth) is not received in return.
    • If the payment you received qualifies as a gift, and the amount is less than the $18,000 annual exclusion for 2024, it is not taxable and does not need to be reported on your tax return.

    2. Self-Employment Income

    • If you provided services to your family member (such as work or labor), the payment is considered self-employment income.
    • This income is reported on Schedule C. Our software will automatically prepare this form and calculate any applicable taxes, including self-employment taxes (Social Security and Medicare).

    How to Enter This in Our Software:

    1. Select the Income tab.
    2. Choose Business Income from the drop-down menu.
    3. Follow the prompts to enter your income and any related expenses.
    4. A Schedule C will be generated based on the information you provide.

      **With either option you will have the ability to e-file your returns.

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