The California Office of Tax Appeals (OTA) held that severance payments and employer-paid medical premiums received following an employee’s termination constituted income from intangible personal property and were therefore sourced to the taxpayer’s Nevada domicile. The taxpayer, a former California-based bank CEO, was terminated without cause in late 2015, relocated to Nevada around the same
personal income tax
California Court of Appeal holds Texas radiologist not a unitary business
By Charles Capouet on
Posted in California, Income Tax
The California Court of Appeal held that a Texas radiologist did not owe California personal income tax because it did not operate a unitary business in the state. During the years at issue, a medical corporation sent the Texas radiologist imaging studies collected at medical facilities in other states, including California. He then read the…
Snowbirds beware: New York couple fails to establish new domicile in Florida
By Charlie Kearns & Sebastian Iagrossi on
Posted in Income Tax, New York
The taxpayers, originally residing in New York, were issued a tax assessment for unpaid income tax but they claimed they moved out of the state and settled in Florida in late 2018 (as part of their retirement plan) while still maintaining living quarters in New York. The taxpayer argued that they had changed their domicile…
Round two: New York upholds the convenience of the employer rule
By Chelsea Marmor on
Posted in Income Tax, New York
The Tax Appeals Tribunal upheld an ALJ’s determination that a taxpayer’s wages earned from working remotely in Connecticut were sourced to New York and subject to tax. For decades, New York has adopted the convenience of the employer test (Rule), which deems a nonresident who teleworks outside the state to be working at its employer’s…
New York Tax Appeals Tribunal upholds DTA ruling on deferred fees and appreciation allocation
By Scott Wright & Madison Ball on
Posted in Income Tax
The New York Tax Appeals Tribunal affirmed a Division of Tax Appeals (DTA) ruling, holding that deferred compensation earned by a partnership should be allocated to New York based on the business allocation percentage (BAP) from the year in which the services were performed, rather than the year in which the deferred income was recognized.…
New Jersey couple not required to include Section 965 amounts in New Jersey income
By Daniel Schlueter & Periklis Fokaidis on
Posted in Income Tax
The New Jersey Tax Court determined that a New Jersey-based couple was not required to include Section 965 amounts in New Jersey income, as deemed repatriated dividends are not subject to the New Jersey Gross Income Tax (GIT), New Jersey’s personal income tax.
The taxpayers owned several interests in controlled foreign corporations (CFCs) and in…
A long goodbye: New York taxes severance package received a year after taxpayer’s relocation to Hawaii
By Jonathan Feldman & Dennis Jansen on
Posted in Income Tax, New York
The New York Division of Tax Appeals (DTA) held that a taxpayer’s employment severance payment received over a year after her relocation out of the state was allocable to New York for personal income tax purposes.
The taxpayer worked for a school in New York for 11 years before going on sabbatical leave and moving…
New York Division of Tax Appeals finds New York source income on restricted stock units
By Charles Capouet & Cyavash Ahmadi on
Posted in Income Tax, New York
The New York State Division of Tax Appeals determined that income from the vesting of restricted stock units of a nonresident taxpayer were subject to New York State personal income tax based on the taxpayer’s performance of services in New York during the restricted stock units’ vesting period. The Tribunal also determined that dividends on…
5 proof of domicile takeaways from Calif. Tax Appeals ruling
By Eric Coffill on
A recent significant precedential and unanimous decision by the California Office of Tax Appeals, Matter of the Appeal of Beckwith, provided more guidance on how to determine California domicile and residency for state personal income tax purposes.
In his article for Law360, Eversheds Sutherland Senior Counsel Eric Coffill provides five domicile takeaways and…
A bridge too far: Ohio Court of Common Pleas finds convenience rule unconstitutional
By Eric Coffill & Cyavash Ahmadi on
Posted in Income Tax, Teleworking and Business Travel
On September 26, 2022, the Ohio Court of Common Pleas in Morsy v. Dumas, held that Cleveland’s municipal income tax on remote workers was unconstitutional on an “as applied” basis. The taxpayer lived in Pennsylvania and was employed by a company located in Cleveland, Ohio.
Prior to the COVID-19 pandemic, Morsy would stay in…