ToddL99
Expert Alumni

State tax filing

Don't try to overanalyze this - if your employer is reporting your W-2 earnings as "MI" sourced (ie. Boxes 15-17 only refer to MI, not NY), then file your MI return and don't worry about NY.

 

It is a long-standing principle that an employee's wages are taxable in their state of residence and in the state where they perform their work. Since you performed the work in MI and are a resident of MI, then your wages are definitely taxable by MI.

 

A minority of states, however, utilize convenience of the employer (COE) rules to determine how nonresident remote employees should be taxed on their income.  These states currently include Connecticut, New York, Pennsylvania, Arkansas, Delaware and Nebraska.

 

As @BillM223 stated, "If you are in Michigan "for the convenience of the employer" - that is, because your employer wanted you there rather than in New York - then your wages would be taxable in Michigan."  It is reasonable to presume your employer is aware of NY rules and has concluded you are working in MI for their convenience.

 

You can ask your employer to confirm this - send them this article for a detailed discussion and the rules on What is New York's "Convenience of the Employer" Rule All About?