Taxes for working remote from another state

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covidiots

New

covidiots
Apr 15, 2020 1 Comment

Is anybody familiar with the tax implications of working remotely from a different state than your employer? A lot of people are doing it these days with corona. This is my current understanding:

You will not get double state taxed. Some states have reciprocity agreements but I think this only applies to commuters who physically travel. The laws are different for full-time remote work.

I just started a new role working from home in a different state than my employer who is in NY. I don't know when I'll be able to relocate and it could potentially be next year. My employer withholds NY tax automatically and I'll have to notify them of my home state which will get withheld as well. At tax time, I will reconcile the double state tax and receive a credit. Because I'm working remote and not commuting, I should be getting a tax credit from my employer state, according to what I read online. Does this mean that all my NY state income tax gets nullified? It seems fair because I'm not even setting foot there. I should pay taxes to the state where I'm located. In my case, my permanent address state has lower income tax. But...I also read that NY has a law denying telecommuting tax credits.

Everything is really confusing. Can somebody please clarify this?

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  • Lyft
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    Go to company page Lyft

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    You pay taxes where you live and will be refunded if your employer paid to another state. You may have to file taxes with both states.
    Apr 15, 2020 0