I lived in DC all of 2018. My Company is in NYC. I earned over 90% of my income working remotely in DC. How do i allocate NY?

[KarenJ · Accepted solution]

Unfortunately, NY is one of the few states that requires you to file in NY if you work remotely but the company is based in NY.  NY states that if you work for a NY employer , then the income is taxable in NY.

So if you worked in NY or if you worked remotely for a company is located in NY but you are a resident of another state, you will need to file a NY nonresident state income tax return to report your NY-source income.

Please prepare the NY nonresident return in TurboTax before you prepare your resident DC return.  This way the software can calculate the credit on your DC return  for the NY tax liability

If the work, however, is for the necessity of the employer, rather than for your convenience, you should not be subject to NY state income taxes. 

To be exempt from New York taxation, such wages must entail “duties … which by their very nature, cannot be performed at the employer’s place of business."

[Wernd]

Thank you. Last item is whether i allocate the time. For instance do i use the allocation to show i was only in NYV 5 days for work or just file as if i worked in NYC? Hope this makes sense

[KarenJ]

NYC has the same requirements as New York State.  So I would assume you have to file a nonresident return for NYC.

[Wernd]

Sorry, i asked the question incorrectly. When i fill out the Non-resident form i come to a section that let's me allocated days worked in NYC. Since it was only about 5 days, do i fill out that allocation methodology? I understand what all have kindly added above but not sure if i show how many days i actually worked in NY since i worked at Home in DC.

[KarenJ]

Yes, go ahead and enter that you were in NY for 5 days.

[Wernd]

Thank you. I think i am done but a bit confused. I filled out NY Non Resident first then DC. The results are that in NY i paid state taxes of$1000 (not the amount but for clarification) and have an over payment of $100 to be refunded. In DC i paid $0 from my pay. I made estimated payments however of $1000, (again for clarification) and will get a refund of $910. I just did this straight without any allocation as i only was in NY about 5 days last year. This means if nothing changes, i don't need to pay estimates in DC and this is done?  

[KarenJ]

NY nonresident return should be taxing you on all of your NY  income that you earned while living in DC.  NY should not be allocating the income by the 5 days you were in NY as you would be under reporting your NY wages.  If it looks like this is what it is doing, remove that you were in NY for 5 days to make sure it is taxing you on all your NY income.

[Wernd]

Thank you. I believe i am now done. It appears DC gets little to no tax since all my income is reported in NY. I was missing that. Thank you again.