I rented a NYC apartment with my fiance in March this year, but I also own a home in Long Island where I let my parents stay in (they help out with finances, but don't really pay rent above FMV, so it's personal use). Most of my mail still goes there, my car is parked there, and my fiance and I plan to travel there monthly. When we go on trips, we'll actually probably head there right away because it's easier to park in Long Island than in NYC. I still maintain a bedroom there, along with most of my stuff. We are renting the apartment pretty much to be closer to our workplace and her school in NYC, which also means that I'll probably spend more than 181 days in NYC.
For 2023, I'm assuming I will be a part-year resident. I tried playing with the numbers on TurboTax and other tax software for my 2022 return (pretended that I select part-year resident for 2022 just to see what it looks like), and the odd thing is that my NY state refund increased! That sounds wrong because I switched from non-resident to resident with no NYC withholding. Am I missing something here?
I had already submitted W4 to my employer to start withholding NYC taxes for 2023 starting March, and even paid estimated taxes for my wages in January and February (because I read somewhere that I still have to pay taxes from when I was non-resident if I'm a part-year resident). But with the test return that I did above, seems I may have just thrown away that money (granted, I can get it next return) because my refund amount became higher. Did I do that right?
And assuming we'll keep on maintaining the apartment next year, will I then be a full-year NYC resident for 2024?
The reason why your refund increases is that you need to pay NYC taxes for the period of time you lived there. This is in addition to the NYS tax.
As far as entering the information into the return that populates the IT 360.1.
Go through the interview carefully as all this information is essential for your return. if entered correctly, you will not need to enter this information directly on Form IT 360.1.
Your refund should go down if you switch from New York City non-residency to part-year residency. I’m assuming in 2022 your worked in NYC but had no NYC withholding because you listed Long Island as your address.
Someone would have to look at your return to tell you why your state refund increased.
You are most likely a New York City resident from March if you have an apartment in the City. New York has a statutory residency rule.
The requirements to be a New York City resident are the same as those needed to be a New York State resident. You are a New York City resident if:
In general, a permanent place of abode is a building or structure where a person can live that you permanently maintain and is suitable for year-round use. It does not matter whether you own it or not.
Learn more at: Frequently Asked Questions about Filing Requirements, Residency, and Telecommuting for New York State Personal Income Tax
Thank you for your informative response!
I am confused as well as to why my refund increases when I switch to part-year resident from non-resident. There's this one tax software that immediately shows you the forms as you fill out the fields. I matched it up with what I have on TurboTax/H&RBlock and I found out that by selecting part-year resident, the resident tax fields related to form IT-360.1 are left empty.
Looks like I'll have to fill out IT-360.1 as a part-year resident, but I can't find the option to do so on any tax software. I only get asked when I moved into NYC and how many days I've lived in the city.
The reason why your refund increases is that you need to pay NYC taxes for the period of time you lived there. This is in addition to the NYS tax.
As far as entering the information into the return that populates the IT 360.1.
Go through the interview carefully as all this information is essential for your return. if entered correctly, you will not need to enter this information directly on Form IT 360.1.