Independent Consultant living abroad

[AndrewSommer]

Hi TurboTax Team,

I'm a German/US dual citizen. I spent most parts of 2020 in Germany (April - November) and ended up working with a company in New York City as an independent online consultant from June - October. I did not file quarterly taxes or submit estimates. I have a 1099-NEC from said company.

How do I need to file my annual taxes now? Do I need to indicate that I worked in another state? Do I qualify for any foreign earned income statuses? 

Thank you for your help!

Andrew

[ThomasM125]

You would not qualify for a foreign earned income exclusion since you were away for less than 330 days in a 12 month consecutive period of time. Also, you are not a bona fide resident of a foreign country and present there for an entire year. Since you didn't establish a residency in another state and you returned to New York, you would be considered a full-year resident of New York.

If you paid any income taxes to Germany you may qualify for a foreign tax credit or deduction.

[AndrewSommer]

Thanks for the explanation, Thomas. I guess I didn't provide all the necessary info on my background. I left NYC and the US at the end of August, spent the next few months travelling around, returned to the US for a 4 day stay at the beginning of January 2020, then moved to Colombia, left Colombia at the end of March, and stayed in Germany from end of March until end of September. I then returned to the states in October, and became a resident of San Francisco, CA in November. 

Would I still be considered a Full-year resident of NY even though I didn't spend any time in NYC in all of 2020? When I filed my taxes for 2019 I also changed my residency from NY to Massachusets given that my family has a house there. 

[DaveF1006]

if you had no formal ties in NYC in 2020, then you were not a NY resident at all in 2020. Also since you changed your NYS residency in 2019, you dissolved your resident ties to NY.

[AndrewSommer]

Thanks, Dave. So how/where do I need to file my taxes for the independent remote contract work I did for a company located in New York in 2020? 

I need to file California taxes for my employment in San Francisco in November & December of 2020. Do I also need to indicate that I worked in another State and enter New York? 

[DaveF1006]

It depends on the state.  In California, it is definitely required.  I looked on the NY state website and it's rather vague on whether or not to file. Here are the requirements that I am able to research. It states " If you do not meet the requirements to be a resident, you may still owe New York tax as a nonresident if you have income from New York sources."

Filing information for New York State nonresidents

If you are a New York State nonresident you must file Form IT-203, Nonresident and Part-Year Resident Income Tax Return, if you meet any of the following conditions:

• You are a nonresident with New York source income and your New York adjusted gross income Federal amount column (Form IT-203, line 31) exceeds your New York standard deduction.
• You want to claim a refund of any New York State, New York City, or Yonkers income taxes withheld from your pay.
• You want to claim any of the refundable or carryover credits available.
• You had a net operating loss for New York State personal income tax purposes for the tax year, without having a similar net operating loss for federal income tax purposes.

My suggestion is to file a New York non-resident return and claim the income earned from the NY employment source and see if there is a tax consequence.  If not, then delete the state return.