Englewood, NJ asked in Employment Law and Tax Law for New York

Q: Tax question: I live in GA, my employer is based in NJ, and I just bought a 2nd home in NY State.

My domicile is GA and I work remote from there ~51% of the time for an employer in NJ. For 2024, I plan to spend ~49% at my NY house. While there, I plan to work from my NY home about 25% and in my NJ office 25%. I'm fine allocating days between the 2 or 3 states and will keep copious records, but I obviously want to avoid paying state tax on the same income for more than one state. With NJ's new "convenience of the employer" rule and NY's longstanding such rule, am I putting myself in jeopardy of double taxation?

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1 Lawyer Answer
James L. Arrasmith
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  • Tax Law Lawyer
  • Sacramento, CA

A: Your situation, involving tax liabilities across multiple states, does indeed present a potential risk for double taxation, especially considering New Jersey's "convenience of the employer" rule and New York's similar stance. These rules can impact how your income is taxed when working remotely.

In your case, working remotely for a New Jersey employer while residing in Georgia and spending significant time in New York complicates the matter. New Jersey's "convenience of the employer" rule implies that income earned while working remotely for a NJ-based employer may be taxed by NJ, unless the work is performed out of state for the employer's necessity. Similarly, New York taxes income earned by nonresidents working in the state and, under its rule, might also tax income earned remotely for a NY-based employer.

Given that you plan to work from your New York home and in your New Jersey office, you'll need to meticulously document your work location on each day to accurately allocate your income among the states. This documentation is crucial to avoid paying tax on the same income in more than one state.

It's advisable to consult with a tax advisor who has expertise in multi-state taxation. They can help navigate these complex rules and assist in planning your work schedule and residency to minimize the risk of double taxation. They can also provide guidance on filing state tax returns and claiming credits for taxes paid to other states, which can help in situations of potential double taxation.

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