New York State Income Allocation.

Forum|Forum|5 years ago
February 22, 2021
1 reply
2 views

I file a Non-Resident Tax Return for NEw York State. In 2020 I received Unemployment Compensation from NY State. In Turbotax it asks me to allocate the New york Source Portion. If I enter the amount of compensation I receive the program states I owe taxes. If i leave it black, as originally shown, I show a refund.

What is the correct entry?

LenaH

Community Manager

It depends. You have to enter the amount of your unemployment that was received as a nonresident resulting from your employment in New York State. If your unemployment compensation received was a benefit for working solely in New York State, then you would allocate your entire unemployment to your non-resident New York State tax return.

If the unemployment compensation received from New York State is based on wage or salary income earned partly in and partly out of New York State, you would have to determine the amount allocable to New York State in the same manner as the wage and salary income on which it is based. For example, if your wages were originally 50% allocated to your resident state and 50% allocated to New York, you would use that same allocation for your unemployment.

If you did not pay enough taxes on your unemployment during the year, you may have to pay additional taxes on it when you complete your tax return. New York considers unemployment income as taxable income for residents and non-residents.

I do not know what your resident state is, but you should be able to get a credit of taxes paid to New York State on your resident tax return.

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droids13Author

Level 2

Lena,

Thank you for the reply.

In 2020 I was a full time resident of Florida, where we do not have a State Income Tax.

I worked for a company based in New York State and collected the umemployment for NY State while living in Florida.

I feel like I am entering the unemployment compensation twice.

In addition, I file a joint Federal with my spouse. My spouse did not work in NY State.

The Turbo Tax program is including her income on the NY State Return.

Do I still allocate my unemployment insurance or just leave the field as blank?

ErnieS0

Level 15

Allocate all your unemployment benefits to New York. Unemployment compensation that is part of your federal adjusted gross income and derived or resulting from employment in New York State is taxable to a nonresident.

I‘m assuming when you say “company based in New York State” you mean you received unemployment as a result of previously working in or telecommuting for a company where your office was considered to be “New York.

It is not surprising you would owe NY tax on your employment because no state tax was withheld.

Your spouse’s income is included on the NY nonresident return. NY includes all income to compute a base tax rate and then calculates NY tax for part-year and nonresidents by prorating the total tax by the ratio of NY income to total income. This produces a higher tax rate, because the rate is based on your total income and not just your NY income.

NY Allocation