Telecommuter - I live in NY work in OH who do I pay income tax to?


W

webgirl

I live in western new york but work for company in Ohio. I
work out of my home office in New York. Currently I am not
paying any ny income tax, the ohio state and local taxes
come directly out of my paycheck each pay term. Where I
can get information on how to pay NY income tax? Do I need
to pay both states?

Moderator: You have come to the right place with your question.
 
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A

Arthur Kamlet

webgirl said:
I live in western new york but work for company in Ohio. I
work out of my home office in New York. Currently I am not
paying any ny income tax, the ohio state and local taxes
come directly out of my paycheck each pay term. Where I
can get information on how to pay NY income tax? Do I need
to pay both states?

Moderator: You have come to the right place with your question.
It seems to me you pay only NY and file an Ohio nonresident
tax return to get back all the Ohio withholdings. If they
withheld Ohio municipal or school district income taxes, you
file to get that back as well.

__
Art Kamlet ArtKamlet @ AOL.com Columbus OH K2PZH
 
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K

Kathryn Morgan

I live in western new york but work for company in Ohio. I
work out of my home office in New York. Currently I am not
paying any ny income tax, the ohio state and local taxes
come directly out of my paycheck each pay term. Where I
can get information on how to pay NY income tax? Do I need
to pay both states?
I do a lot of folks like this. First off you will file as a
non-resident for the state/local taxes in Ohio. Then you
file as a resident of NY and take a credit on your NY taxes
for any tax liability in OH. That is you bottom line
liability, not what you had held out for Ohio.

You also might want to check and see if your company has a
NY State EIN and can just hold out NY taxes instead of OH
all together. Unless you actually worked in OH at anytime
of the year you should get everything back as you actually
have $0 taxable income in OH your company is just based
there. Just send a letter attached to the OH return
explaining that your company withheld OH taxes in error and
you do not now nor have you ever worked or lived in Ohio.
Works for me all the time with my clients.

--
Kathy Morgan EA, LRTP
H & R Block Master Tax Advisor
Proud Mom of Sgt RT Morgan
1/156 AR BN C Company
Louisiana Army National Guard
 
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M

Missy

I hope someone from NY chimes in, but having taxpayers in 31
states, most of the time, you pay your home state (NY) and
get a refund or credit from the taxing state (OH). There is
(lines 60-61-62) on the form IT 1040 (OH) enter the last
number on line 12 form IT 1040. This lets you subtract the
income (looks like all) that you did not earn in OH or while
a resident of NY. The lines are on the 2004 tax forms, I
presume that they will be the same on the 2005 forms.

Missy Doyle
Plainville IL
 
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W

webgirl

Thanks everyone for the information. I did live in Ohio all
year until July 5th. So it sounds as if I will have to ask
for a refund from Ohio for July 5-Jan.1 and pay NY from July
5- Jan.1 I will also ask my company about a NY State EIN.
I am assuming NY has higher taxes than Ohio so I will
probably up the % that is taken out of my paycheck now so I
won't get hit so hard in January.

Thanks again!
 
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S

Seth Breidbart

Thanks everyone for the information. I did live in Ohio all
year until July 5th. So it sounds as if I will have to ask
for a refund from Ohio for July 5-Jan.1 and pay NY from July
5- Jan.1 I will also ask my company about a NY State EIN.
I am assuming NY has higher taxes than Ohio so I will
probably up the % that is taken out of my paycheck now so I
won't get hit so hard in January.
If it's taken out for OH it won't help you at all for NY.
Get it taken out for NY, or _reduce_ the amount taken out
for OH (ideally to 0) and pay NY Estimated Tax.

Seth
 
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P

pgattocpa

webgirl said:
Thanks everyone for the information. I did live in Ohio all
year until July 5th. So it sounds as if I will have to ask
for a refund from Ohio for July 5-Jan.1 and pay NY from July
5- Jan.1 I will also ask my company about a NY State EIN.
I am assuming NY has higher taxes than Ohio so I will
probably up the % that is taken out of my paycheck now so I
won't get hit so hard in January.
On 10/31/2005 the Supreme Court refused to grant certiorari
in the case of a TN telecommuter who worked for a NY-based
union. The NY case is Huckaby v. New York State Division of
Tax Appeals, 04-1734.

NY's lawyers argued that NY was entitled to tax Huckaby's
earnings because he chose to live in another state "solely
for his own convenience." The attorneys' acknowledged that
under NY's current interpretation of its tax laws the income
would have been exempt if he were required to work
elsewhere.

It seems to me that Webgirl may have the reverse case (i.e.,
working in NY for a non-NY based company) and taxability in
NY may be dependent upon OH's rules. If similar to NY, then
she would have a *real* OH liability and would have to file
an OH return and then take a tax credit on the NY return.
(This would be opposite of the responses stating that
Webgirl would get a refund of her OH tax withholding).

Now the odds of OH being as aggressive as NY may be long,
but once the states digest the implications of the SC's
refusal to hear the Huckaby case, they may get more
aggressive. Any OH tax people out there who can comment?

Peter C. Gatto, CPA
 
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A

Arthur Kamlet

webgirl wrote:
On 10/31/2005 the Supreme Court refused to grant certiorari
in the case of a TN telecommuter who worked for a NY-based
union. The NY case is Huckaby v. New York State Division of
Tax Appeals, 04-1734.

NY's lawyers argued that NY was entitled to tax Huckaby's
earnings because he chose to live in another state "solely
for his own convenience." The attorneys' acknowledged that
under NY's current interpretation of its tax laws the income
would have been exempt if he were required to work
elsewhere.

It seems to me that Webgirl may have the reverse case (i.e.,
working in NY for a non-NY based company) and taxability in
NY may be dependent upon OH's rules. If similar to NY, then
she would have a *real* OH liability and would have to file
an OH return and then take a tax credit on the NY return.
(This would be opposite of the responses stating that
Webgirl would get a refund of her OH tax withholding).

Now the odds of OH being as aggressive as NY may be long,
but once the states digest the implications of the SC's
refusal to hear the Huckaby case, they may get more
aggressive. Any OH tax people out there who can comment?
The Ohio NR/PY schedule asks for the amount of Ohio
Gross Income not earned or received in Ohio. Received
means you were a resident of Ohio at the time.

So if you were an Ohio resident and worked in NY, Ohio
wants the tax, but allows another credit for income
taxed by another state.

This is the entire OH PY/NR schedule:

Line 60. Enter the portion of Ohio Adjusted Gross Income
(line 3) that was not earned or received in Ohio
(attach calculation)
_
61. Enter the Ohio Adjusted Gross Income (line 3)
62. Divide line 60 by line 61 Multiply by the amount on line 12.
Enter here and on line 13. ...................... 62

What happens is the Ohio income tax is reduced by the
% of nonOhio income.

__
Art Kamlet ArtKamlet @ AOL.com Columbus OH K2PZH
 
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