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New York Issues Much-Anticipated Guidance on Taxation of Telecommuting Employees

Since the outset of the COVID-19 pandemic and work-from-home mandates, New York employers and their nonresident employees have been waiting for the Department of Taxation and Finance to address the million-dollar question: Do wages earned by a nonresident who typically works in a New York office but is now telecommuting from another state due to the pandemic constitute New York source income? New York has historical guidance concerning the application of its "convenience of the employee/necessity of the employer" test, the test used to determine whether a telecommuting nonresident's wages are sourced to New York, but until recently the Department had been silent as to whether or how such rule applied under the unprecedented circumstances of the COVID-19 pandemic. As many expected, in a recent update to the residency FAQs, the Department clearly stated its position that a nonresident whose primary office is in New York State is considered to be working in New...

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Finishing SALT: August Wrap-Up & Looking at September

A Grain of SALT: September State Focus – New Hampshire With the road paved in the US Supreme Court’s now famous South Dakota v. Wayfair Inc. decision, many states have begun releasing remote-seller sales tax collection guidance. Interestingly, the state of New Hampshire has joined the fray as well even though it does not impose a state sales tax. New Hampshire’s efforts are specifically directed at preventing out-of-state taxing authorities from imposing remote-seller sales tax collection obligations on New Hampshire businesses located solely in the state. These efforts come via a bill sponsored by Rep. Jess Edwards (R) and Rep. Kevin Scully (R) and planned to be introduced in early 2019. The bill would make sales and use tax collection obligations on New Hampshire remote-sellers by out-of-state jurisdictions unlawful. According to Rep. Edwards, this bill is being filed because “we do not recognize any other taxing jurisdiction other than New Hampshire to...

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Unclaimed Property Gift Card Legislation to Watch

Most states are well off to the races with their 2017 legislative sessions and several states have gift card legislation pending that would impact unclaimed property holders. Oregon On January 9, 2017, a bill (SB 113) was introduced in the Senate that would create a new unclaimed property reporting obligation for gift cards, which would apply to gift cards issued or sold after the effective date of the bill. SB 113 would accomplish this by amending the state consumer protection law to provide that a cardholder may only redeem a gift card from “[t]he person that a gift card identifies as providing goods or services” and such person “shall transfer to the Department of State Lands, in accordance with [the Uniform Disposition of Unclaimed Property Act], any remaining balance from a gift card that a cardholder has not used within five years after the date of the last transaction that used the gift card for a purchase.” Keeping consistent with the changes above,...

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U.S. Supreme Court’s Wynne Decision Calls New York’s Statutory Resident Scheme into Question

On May 18, the U.S. Supreme Court issued its decision in Comptroller of the Treasury of Maryland v. Wynne. In short, the Court, in a five-to-four decision written by Justice Alito, handed the taxpayer a victory by holding that the county income tax portion of Maryland’s personal income tax scheme violated the dormant U.S. Constitution’s Commerce Clause. Specifically, the Court concluded that the county income tax imposed under Maryland law failed the internal consistency test under the dormant Commerce Clause, because it is imposed on both residents and non-residents with Maryland residents not getting a credit against that Maryland local tax for income taxes paid to other jurisdictions (residents are given a credit against the Maryland state income tax for taxes paid to other jurisdictions). The Supreme Court emphatically held (as emphatically as the Court can be in a five-to-four decision) that the dormant Commerce Clause’s internal consistency test applies...

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