I am filing a 1099-MISC for freelance work. The business is in CT but I did all of the work in NY over the computer - do I need to file a CT return?

[taylorvarga]

I am also filing as a full year NY resident.

[maglib · Accepted solution]

Wages of a nonresident are subject to Connecticut income tax withholding if the wages are paid for services rendered in Connecticut. Wages of a nonresident are not subject to Connecticut income tax withholding if the wages are paid for services performed entirely outside of Connecticut.  Since Connecticut only considers income from work performed in Connecticut to be sourced to Connecticut then work you performed in NY should not be subject to CT income taxes. http://www.ct.gov/drs/cwp/view.asp?a=1479&q=277548

NY is your resident state so all income is taxable to NY.

An interesting tax case with the opposite issue as CT and NY rules differ, you are lucky that yours is the opposite:  https://www.cga.ct.gov/2004/rpt/2004-R-0063.htm

I hope this was helpful?

[taylorvarga]

Ok...so - I do NOT have to file a CT return because I did not perform the work in CT?

[taylorvarga]

Even if for some of the work in 2017, I had JUST moved to NYC and didn't hit the 183 day rule of being a "full-year resident" until sometime in December?

[maglib]

Where were you living during 2017 and where was work performed. Please specify date ranges and ranges of the income when earned.  CT only if you performed the work in CT is it taxable to CT. If you lived in CT at any point you are a part year resident and yes for that portion of the work, you pay taxes to CT as your resident state. You always pay taxes to your resident state.  You may or may not have to pay taxes to a state you did work outside their state depending on that particular states rules. NY taxes any work done for a NY location regardless if the work was performed there and regardless if you were not a resident, they have very strict rules.

[taylorvarga]

From January 2017 - May 2017, I was going to school in New York State, but I was still a resident of Connecticut because the residency rule does not apply to college students. I had a job at the college in New York State, so I am assuming that income must go on my CT return. I then moved to New York City in June of 2017, and from June 2017 - December 2017, I performed freelance work over the computer for a business located in Connecticut. I have lived in New York State for more than 183 days this year, meeting the requirement to file as a full-year resident of New York State.

[maglib]

I hope you filed a change of address with CT and had your voting records and Drivers records switched as proving residency is easiest then.  So for Jan to May you are a part year resident of CT  and yes you pay taxes as a resident of CT for any money earned in NY from Jan-May, the interview will help you allocate.  For Jan- May you are a non-resident of NY and would potentially owe money to NY for the income earned for that period of time as a non-resident.  For June to December you are a part year resident of NY and the freelance work since it was NOT performed in CT is only taxable to NY.  During the NY interview you will have to allocate income for nonresident and resident periods.   )NOTE:  the full year NY resident rule is you maintain a permanent place of abode in New York State for more than 11 months of the year AND spend 184 days or more in New York State during the tax year (do note that you are not a resident for the full year as the 11 month rule means your permanent place of abode).  

On the CT part year resident return you should get a credit for any taxes you actually had withheld in NY up till May on the income earned in NY till May.

[maglib]

(I'm heading to bed, I will help if you comment further but not till tomorrow...  I hope this helped.  Have a good night.

[taylorvarga]

I believe the 184 days / 11 months is an AND/OR rule.

[taylorvarga]

And yes, I did file a change of address with CT

[maglib]

I copied the 11 month rule from the NY website... it's AND

[maglib]

<a rel="nofollow" target="_blank" href="https://www.tax.ny.gov/pit/file/pit_definitions.htm">https://www.tax.ny.gov/pit/file/pit_definitions...
You're a New York State resident for income tax purposes if:

your domicile is New York State (see Exception below); or
your domicile is not New York State but you maintain a permanent place of abode in New York State for more than 11 months of the year and spend 184 days1 or more in New York State during the tax year.