Hi,In 2021, I moved from New York to New Hampshire, so I lived the first 2/3 of the year in NY. I currently live in NH, which does not have a state income tax. I am trying to figure out if I should pay NY tax on 2/3 of my income or 100% of it?Here are my circumstances:I have worked remotely, from my home for all of 2021.I have had the same employer for all of 2021, a tech company based in CA. The address of the company on my W2 is the headquarters CA address. On the W2, there are NY state taxes taken out of my income.The company has an office in NYC, and before the pandemic, I went in to this NY office full time.I will be getting a refund from NY state either way (2/3 or 100% consideration).I have read a few sites and forums, and have seen the NY state (1 of 6 states) convenience rule. However, it usually states that the company should be based in NY for this to apply. My company is based in CA, but my office (before the pandemic) was in NY, so I am asking for clarity in this situation. Thank you for your help!

Question

New York state tax, remote work, partial year resident

Forum|Forum|4 years ago
April 13, 2022
1 reply
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Hi,

In 2021, I moved from New York to New Hampshire, so I lived the first 2/3 of the year in NY. I currently live in NH, which does not have a state income tax. I am trying to figure out if I should pay NY tax on 2/3 of my income or 100% of it?

Here are my circumstances:

I have worked remotely, from my home for all of 2021.
I have had the same employer for all of 2021, a tech company based in CA. The address of the company on my W2 is the headquarters CA address. On the W2, there are NY state taxes taken out of my income.
The company has an office in NYC, and before the pandemic, I went in to this NY office full time.
I will be getting a refund from NY state either way (2/3 or 100% consideration).

I have read a few sites and forums, and have seen the NY state (1 of 6 states) convenience rule. However, it usually states that the company should be based in NY for this to apply. My company is based in CA, but my office (before the pandemic) was in NY, so I am asking for clarity in this situation.

Thank you for your help!

Not A Product Question

DanielV01

Employee

This is a tricky situation. Because of New York's convenience rule, they will contend that all of it is taxable. But that doesn't mean that it necessarily is that way. In these circumstances your income is not taxable to New York:

Your remote work for the company is not performed on behalf of the New York office. If the remote work is being performed directly for the California based company, and not their NY office, there is no convenience rule from New York. California would have to claim convenience, and they don't have that provision. You will allocate your New Hampshire working days as non-NY days, and retain documentation that shows the nature of the work was not on behalf of the New York office.

You moved to New Hampshire, qualify to file a part-year return for New Hampshire (even though they do not have a state income tax), and, after the move, did not maintain more than a de minimis physical presence working for the New York office. If after moving to New Hampshire you did not work both within and without New York, they don't have a basis in statute to claim convenience. You may follow the same technique as above to allocate New York income, and retain documentation to support your position if you need to defend it.

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