Question

How do I determine my New York tax liability as a non-resident short term COVID health care worker?

Forum|Forum|5 years ago
April 9, 2021
1 reply
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In 2020, I traveled from my state of residence (Texas, no income tax) to New York State as a short term COVID health care worker. My employer was based in another state. My W-2 does not list any state wages, however there was much news about now NY would tax COVID health care workers. How do I determine my NY tax liability? I tried to estimate it based on days worked in NY, but Turbo Tax then asks if I need to fill out the "Nonresident Business Allocation Schedule" and I have no idea.

TurboTax Deluxe Online

AmyC

Employee

If it is w2 wages, you would just allocate for the amount earned based on the days you worked in NY.

As a travel nurse, are you working as a contractor so that you file sch C?

If so, then instead of w2 wages, you have a 1099-NEC and would allocate the NY portion.

Business allocation would be for your sch C business, sch E rental, or sch F farm.

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S

SJP5Author

Thanks for the reply. I was not working as a contractor. My employer paid taxes and I received a W2. My issue is that I was told I would have to pay NY income tax, but the W2 does not reflect that so I am not sure how to handle it/what documentation I need to provide.

AmyC

Employee

When you go through the NY return, it will begin with the federal AGI and add your NY income and subtract all of the non-NY income to find the NY taxable income.

The NY return will list all of your income from every source. Simply fill in the NY wages under NY source portion of wages to calculate. NY will gladly take your money.

Your resident state taxes all income but gives a credit for income taxed by another state. Please carefully follow these directions.

You will need to prepare the states in a special order. You may need to delete both states and begin again.

First, prepare your non-resident NY return. This creates your tax liability for the non-resident state. How do I file a nonresident state return?
THEN prepare your resident state return and it will generate a credit for your income already being taxed in the non-resident state.
The credit will be the lower of the state tax liabilities on the same income. You may owe your resident state.

It isn't possible for the program to create a credit before it knows the liability. Your returns may be wrong if you do not prepare the states in this order.

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