Because of taxes, everyone says that you make less money if you work in New York City compared to New Jersey. Is there a way to estimate the difference?

Edit: I should have specified that I am trying to estimate while living in New Jersey. So living in NJ, comparing working in NYC to NJ.

2 Answers 2


Find approximate housing-cost difference, which is likely to swamp the tax differences. Find a cost-of-living measurement you believe for each state and figure appropriate state's sales tax on the non-housing portion of it (numbers can be found on line). Figure out roughly what your state income tax would be (forms on line). Figure city sales tax for each city you'd live in (again, numbers on line). Determine transportation cost differences. Determine entertainment cost differences ("First prize: one week in Hackensack. Second prize: TWO weeks!")

Mix and add seasonings to taste...

Then remember that many people commute into the City, including from NJ, so run the numbers that way... and think about how much time you're willing to spend communting every day (and via which forms of transportation); the worse the commute, the less housing costs.

Then remember that companies in NYC are aware of all the above, and are likely to adjust their salaries to partly offset it... because otherwise they couldn't recruit anyone who wasn't already a Noo Yawker... so the real question here is whether their adjustment, plus not living in Noo Joisey, is enough to make up the difference for you.

To get more accuracy than that, you need to start nailing down specifics.

Possible. Not trivial.


If working in NY - you pay NY taxes. If living in NJ - you pay NJ taxes. If NJ taxes are lower than NY taxes - you lose the difference by paying NY taxes vs paying NJ taxes if you have an option of having the same work and the same salary in NJ. Pretty simple, really.

Generally, salaries in NY are a bit higher to compensate for that.


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