If I received unemployment from NY state while temporarily residing in another state until covid allowed me to return, would I claim it as NY resident income?

[nh12]

I received unemployment from NY state due to covid-19. If I left the state temporarily at the beginning of my unemployment with no intention of it being permanent and paying for my NY apartment still but remained gone for 7 months and still collecting unemployment from NY, would I put the unemployment in full that I was paid under NY resident income?

Also, if I moved at the end of those 7 months permanently to CA, and collected 1.5 additional months of unemployment from NY before landing a new position in CA, would I still put the full unemployment comp down as New York Resident Income?

If it is not New York Resident Income, does that mean I would have to file taxes in the state that I temporarily lived in for 7 months (although there was never intent for it to be permanent)?

[LenaH]

As a resident, you will report all of your income to New York State since since you are domiciled in the state. Your domicile is your permanent and primary residence that you intend to return to and/or remain in after being away (for example, temporary leave due to Covid-19). All of your income is taxable by New York State. 

You should not be required to file a non-resident return in another state unless you worked in that state during the time you temporarily relocated. If that is the case, you would report that income on a non-resident return and get a credit on your NYS tax return for taxes paid to another state.

If at the end of seven months you permanently moved to California, then you would file a part-year New York tax return for the time up until your official move to California. Then, you would file a part-year California return for the 1.5 remaining months.

However, even after you relocate, 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/part-year New York State tax return.

[colosmilin2021]

So what if I left NY and made permanent residence in Colorado and don't return to NY how do I do my unemployment?  I received unemployment from NY but live in Colorado

[ToddL99]

Report all your unemployment on your federal return.

You will be subject to NY tax on any unemployment received while still in living NY (in 2020) - depending on how much that might be, you may have to file a 2020 NY return.

You will be subject to CO tax on any unemployment received after becoming a CO resident. As a CO resident on Dec 31, 2020, you will probably have to fie a CO part-year resident return (will depend on your total and types of income)

Taxes are based on the state where you lived at the time you received the payments not where the company or organization is located that distributes the payments. 

[kozak61]

If I received unemployment from NY state while living full year in PA do I need to file a NY non-resident return? I did not work or live in NY in 2021.

[DaveF1006]

It depends. To clarify, how did you receive unemployment from NY State if you never lived there?  

[kozak61]

I worked in NY but lived in PA

[GeorgeM777]

@kozak61.  According to the Office of Unemployment Compensation for PA, the following benefits are considered gross income for federal income tax purposes.

• Unemployment Compensation (UC)
• Pandemic Emergency Unemployment Compensation (PEUC)
• Trade Adjustment Assistance (TAA)
• Pandemic Unemployment Assistance (PUA)
• Federal Pandemic Unemployment Compensation (FPUC)
• Lost Wage Assistance (LWA)

Regarding the above benefits, and specifically the unemployment compensation benefit because that is what you received, the Office of Unemployment Compensation also states the following:

"These benefits are not taxable by the Commonwealth of Pennsylvania and local governments."  Here is a link to the PA Office of Unemployment Compensation from which the above information was obtained.

PA Office of Unemployment Compensation

Your question raises the issue of residency because you did not indicate whether you are now a PA resident.  As a way of background, although the rules vary among states, most states define a “resident" as an individual who is in the state for other than a temporary or transitory purpose. States consider a person’s “domicile" to be the place of his or her permanent home to which he or she intends to return to whenever absent from the state for a period of time. Most states claim the right to tax an individual’s income if they are believed to be a resident and domiciled in that state.   However, as described above, if you are a PA resident, your unemployment compensation will not be subject to tax by PA. 

In contrast to PA, NY does tax unemployment compensation.  Thus, you will need to consider to which state, PA or NY, you are a resident of, and once you have made that determination, file the appropriate state tax return if necessary. 

[kozak61]

I am a full time resident of PA. I received Unemployment from NY because I used to work there. I now understand that I do have to pay tax on the unemployment from NY on a NY non-resident tax form. Do you know if this would apply to all states or maybe just NY does this. I see a lot of comments that you pay where you reside not where it came from. Also in the Turbo Tax software the section for unemployment implies or suggests that you do not need to include it. I see that it can be overwritten so that was a mistake I made on my 2020 NY non-resident return and now I am paying interest plus penalty. I will have to do this again in 2021 since I received my only income from NY unemployment. In addition Turbo Tax says that I shouldn't need to purchase a NY non-resident return for 2021 but I really need to. This may be a small bug in its system.

[ErnieS0]

States generally tax all income that is sourced to a state so unemployment would generally be taxable to the issuing state, as would severance, accrued vacation pay, etc.

California says "Sick leave, vacation pay, and bonuses earned by a nonresident for services performed in California are considered California source income. See the Appeal of Edwin O. and Wanda L. Stevens, 86-SBE-100, May 6, 1986."

See 3440 Sick Leave, Vacation Pay, Bonuses, and Severance Pay in California's Residency and Sourcing Technical Manual

Unemployment is a bit tricky because not all states tax unemployment benefits while other states have deductions based on income.

[ana169]

Hi there! What do I do if I have 2021 unemployment from NY but I lived the whole year in Florida? I lived in NY in 2020 and moved to fl at the end of the year. 

Thanks in advance 🙂

[DMarkM1]

Since you permanently moved to FL you are now a FL resident.  You will need to file a NY non-resident form to report the NY unemployment.  NY does tax non-residents on unemployment benefits earned from NY employment.  

In the "My Info" section scroll down to the "Other State Income" topic.  There you will select "Yes" you earned money in another state and select NY from the dropdown list.  This will generate the NY non-resident return.  When you go through the NY state interview you will have the opportunity to allocate only the NY unemployment to NY.  

Be advised, NY does use all income to calculate the NY tax on only the NY allocated income.  So you will see all your income represented but the tax will only be on the NY portion in the end.

[danjo2]

Hello,

I live in PA and received NY unemployment (from my prior work there).  I see that PA (resident filing) does not tax my NY unemployment.  However, when filing my NY (non resident) taxes, NY is taking my husband's income into account to determine my tax bracket.  I therefore owe more taxes than were originally taken out of unemployment (was 3%, but is now 4.159%).  Am I able to recoup any of these taxes paid to NY on PA schedule G-L?

Thanks in advance.

[LenaH]

No. You cannot get a credit of taxes paid to New York on your Pennsylvania return because there is nothing that is being double-taxed. The state of Pennsylvania does not tax unemployment compensation. 

[Edited 4/13/22 l 6:11 AM PST]

@danjo2

[danjo2]

Great.  I have done that, but I'm still unsure what #s to include on the schedule G-L .  Do I fill this out once for myself and once for my husband?  I am getting tripped up because it asks for the income that is being taxed by both states.  Since PA doesn't tax my NY unemployment, and NY doesn't tax my husbands W2 or interest/dividend income (it just uses it to bump up my tax bracket), what exactly do I include in each of our schedules?  Thanks again!!!