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General Withholding Requirement: New Jersey gross income tax generally must be withheld from wages paid to resident employees for services performed either within or without the state and from wages paid to nonresident employees for services performed in the state.owever, when resident employees perform all their services outside the state, their wages are subject to New Jersey withholding only to the extent the New Jersey tax exceeds the other state's withholding tax on the same wages.
NJ Income Tax  Retirement Income. Pensions, annuities, and certain IRA withdrawals are taxable and must be reported on your New Jersey resident income tax return. However, the taxable amount you show on your State return may differ from the amount that is taxable for Federal income tax purposes.