New York City follows NY State guidance. The "bona fide employer office" exception is narrow, meaning that most work-from-home employment still would be treated as New York-sourced income. Jurisdictions are shifting from temporary relief and guidance, driven by the pandemic, to enacting new legislative, regulatory, and administrative guidance to adapt to the expansion of more permanent remote-work arrangements.21 Tax professionals will find opportunities to be both proactive and reactive in addressing these evolving state and local tax issues. It helps both employees and employers avoid tax time surprises and manage the growth of telecommuting. Discover how EY insights and services are helping to reframe the future of your industry. As businesses enter the clichd "new normal," it may appear everything has changed. This article discusses the history of the deduction of business meal expenses and the new rules under the TCJA and the regulations and provides a framework for documenting and substantiating the deduction. See also Bell-Jacobs, McCann, Wlodychak, ", See also Yesnowitz, Sherr, Bell-Jacobs, ", Where Individual, Corporate, and Passthrough Entity Taxation Meet, AICPA Focuses Advocacy Efforts on Mobile Workforce Legislation, Marrying ESG initiatives to business tax planning, Early access to wages may require new employment tax analyses, Determining gross receipts under Sec. That said, your employer state may be able to claim you as a resident too. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. Tax Appeals Tribunal of New York and Huckaby v. New York State Div. Do Not Sell or Share My Personal Information. 2d 619 (2004) (denying certiorari requested by a taxpayer challenging New Yorks convenience rule). While Philadelphia maintains a "requirement of employment" standard, temporary relief was provided during the pandemic. For non-resident employees who perform services both in and outside of New York, the income derived from New York sources is determined by the proportion of days worked in New York versus days worked everywhere else. Planning should be done proactively for unforeseen future tax consequences. . Instead of a uniform federal standard, employers must follow a patchwork of local tax regulations set by states and cities, which can be modified regularly or in response to emergencies like COVID-19. Naturally, your home state (also known as your domicile) is a given. New York has traditionally been aggressive in auditing high-net-worth individuals returns to determine whether they are paying the proper amount of income tax to New York. Apportionment drives the calculation of state taxable income or the taxable portion of a state's franchise tax base. Thus, Pennsylvania adopted a status quo approach. Care needs to be taken in understanding how the credit may work especially if you are a statutory resident in one state, a permanent resident in another state and potentially have nonresident source income from a third state.

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