Neighborly Relations!

[ATSMAN]

Saw this discussion in an article. I would love to see this matter go through the courts and settled. I have several clients in CT that are in this situation.

Section 132.18 (a) of the New York tax code. It says anyone who works out of an office in New York, but lives out of state — whether in Westport, Connecticut, or Chatham, New Jersey — must pay New York income tax. And the Empire State stands out in how strictly and aggressively it enforces the statute, even if your job is done predominately from home.

There is, however, one exception: when work from home is a “necessity,” which is exactly what’s happening now with states imposing shelter-in-place decrees everywhere.

Section 132.18 (a), income tax for non-New York residents, says, “However, any allowance claimed for days worked outside New York State must be based upon the performance of services which of necessity, as distinguished from convenience, obligate the employee to out-of-state duties in the service of his employer.”

[Lion]

The three states (NY, CT, NJ, and maybe more) are trying to come up with coordinated regulations re state taxation of working from home during this pandemic. I hope they do work together. I have lots of NY commuters residing/quarantined in CT. I have colleagues dealing with CT/MA and CT/RI issues. And, I have one NY H&W partnership now working from their PA home. NY looks at control/where employer is located. CT looks at location/where you preform your job. My commuters could end up paying state tax to both NY and CT and NOT qualify for a credit against taxes paid to another jurisdiction -- unless the states get their acts together. Email your state legislators, attorneys general, governors, NYC mayor, anyone you can think of.

[ATSMAN]

Email your state legislators, attorneys general, governors, NYC mayor, anyone you can think of.

Right on! It should NOT have taken a Pandemic to bring this issue to the front burner. There were a lot of people working from home in these states particularly in tech and finance sectors. I have clients who maybe show up at the employer location in NY or CT once a month for a meeting. All their work is done on computers located at their home with clients all of the country and overseas.

So why does NY think that the work was performed in NY (just because the employer has a NY address)??

[Lion]

NY says it's under the control of a NY employer.

Have a retired Top 10 employee in Stamford; her finance department alternated annual meetings between NY and CT. NY had company withhold for those days in NY every other year. Company stopped holding annual meetings in NY. NY lost out on hotel, restaurant, transportation, and other income!

[ATSMAN]

NY says it's under the control of a NY employer.

Have a retired Top 10 employee in Stamford; her finance department alternated annual meetings between NY and CT. NY had company withhold for those days in NY every other year. Company stopped holding annual meetings in NY. NY lost out on hotel, restaurant, transportation, and other income!

Time for Cumo vs. Lamont

[Lion]

Last time NY & CT got into a taxing tizzy, the attorneys general duked it out, and CT commuters won! This time I hope we have at least three to six states involved, and I hope the residents of all the states win/avoid double taxation and unnecessary tax complexity. Other adjoining states have forged reciprocity agreements. As close as the borders are in the northeast, I hope the governors work this out.