Do you live and/or work in Alaska, California, New Jersey, New York, Pennsylvania, Rhode Island, Washington or West Virginia? If so, chances are your employer is withholding mandatory contributions to a state disability, family leave, unemployment, and/or workers’ compensation fund from your paycheck.
You can deduct these mandatory employee contributions as a tax if you itemize it on Schedule A.
These withholdings are considered a form of state and local income tax. So if you elect to deduct state and local sales tax instead of state and local income tax you cannot also deduct your contributions to these state funds.
In most states, as is the case with New Jersey withholdings, there is a statutory maximum contribution for each fund. If you have more than one employer and because of this you have more than the maximum amount of contributions withheld during the year you may be able to get a refund of the excess contributions.
In New Jersey you can claim a refund of excess family leave, disability and/or unemployment withholding on the state resident or non-resident income tax return.
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