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Noonan’s Notes Blog

About This Blog

Noonan’s Notes Blog is written by a team of Hodgson Russ tax attorneys led by the blog’s namesake, Tim Noonan. Noonan’s Notes Blog regularly provides analysis of and commentary on developments in the world of New York and multistate tax law. Noonan's Notes Blog is a winner of CreditDonkey's Best Tax Blogs Award 2017.

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Timothy Noonan 
Ariele Doolittle
Joseph Endres
Daniel Kelly
Elizabeth Pascal 
Craig Reilly
Andrew Wright 

Photo of Noonan’s Notes Blog Timothy P. Noonan
Partner, Tax Residency Practice Leader
tnoonan@hodgsonruss.com
716.848.1265
View Bio »
Tim focuses his practice in the state and local tax area. His work primarily involves New York State and New York City tax litigation and controversy. Over the past 23 years, he …

Showing 147 posts by Timothy P. Noonan.

Another Win for Telecommuters! Missouri Judge Holds St. Louis Improperly Applied Tax to Remote Workers

Another win for telecommuters! Yes, you read that right! We recently covered a case involving a Pennsylvania-based employee who won a Covid-related telecommuting case in Ohio. Now remote employees have another win to add to their pile of Covid-related telecommuting cases. In Missouri, a judge just ruled that St. Louis improperly applied its 1% earnings tax on nonresident employees who worked outside the city during the Covid-19 pandemic.

A Blue Wave of High Tax Rates?

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As residents and SALT practitioners in New York, we see firsthand how high income tax rates drive the personal decision making of taxpayers as well as enforcement efforts by tax departments. On the taxpayer side, we’ve seen tangible (albeit anecdotal) evidence that taxpayers will make decisions on where to work or live based on their taxes. We saw this in 2018 with the explosion of moves following the implementation of the SALT cap, and again in New York in 2021 when, combined with Covid, taxpayers exited New York at a record-breaking pace, coincidentally around the time that the New York legislature raised the highest combined tax rate for New York State and City resident taxpayers to 14.7%. Of course, over the years New York has become somewhat of a leader in personal income tax enforcement, particularly in the residency area, to address the movement of taxpayers both in and out of the state. For example, over the course of 2018 through 2022, the tax department reports performing over four thousand residency audits per year. More recently, the tax department has put in place a massive “desk audit” program specifically to have a process that immediately questions taxpayers who left the state in 2020 or 2021.

NYC PTET Update: Election Forms Now Available!

The New York City Pass-Through Entity Tax (“NYC PTET”) online application is now available, allowing individuals eligible to opt in to the NYC PTET on behalf of an eligible city partnership or eligible city resident S corporation.  

Another Big Win in the Statutory Residency Area!

An interesting residency case came out last summer on a statutory residency issue, and it may have got lost in all the hubbub around the Obus case (which we covered here). In Matter of Joseph Pilaro, the Tax Appeals Tribunal held that the taxpayer didn’t maintain a permanent place of abode (PPA) for substantially all of 2014, even though he had a place in New York for most of the year. The decision provides several helpful nuggets for future residency battles.

Remote Work Employee Win!

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Yes, you read that right! The first employee win we have seen on the COVID-related telecommuting cases recently came out of Ohio. During the pandemic, many states came out with guidance on how to treat the income employees earned while working remotely, some of which was contrary to their existing rules. Ohio was one of those states that acted quickly, with HB 197 taking effect March 27, 2020. Backdating to March 9, 2020, and lasting until 30 days after the state of emergency ended, Section 29 of HB 197 stated, for municipal income tax purposes, employees were deemed to be performing services at the employee’s principal place of work, rather than where the employee was physically working. This notably applied to both resident and nonresident employees. The alleged intention of the bill was to lessen the burden on employers by not requiring them to change the municipal withholding of their employees. This rule looks a lot like the “convenience of the employer" rule that a few states, including New York, applied before Covid, and that many states migrated to during the pandemic. 

New “Jock Tax” Ruling out of Pennsylvania

Over the years, we have written on a variety of topics that involve professional athletes -- from how states handle signing bonuses to an overview of multistate tax issues. This past week, there was an interesting new development to add to the list. On September 21, 2022, the Court of Common Pleas of Allegheny County ruled Pittsburgh’s “jock tax” is unconstitutional in Francoeur v. City of Pittsburgh

It’s Official: New York City Pass-Through Entity Tax Retroactive to January 1, 2022

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As we reported here several months ago, this year's New York State budget included a provision for a New York City Pass-Through Entity Tax, effective in 2023, that would allow New York City resident owners of pass-through entities to benefit from a local Pass-Through Entity Tax regime. Shortly after it was passed, many wondered why there was only a prospective effective date. Given that a change like this should be net neutral to the State and City government, why not make it retroactive to January 1, much like the State Pass-Through Entity Tax was made retroactive when it was put in place in 2021?

A Huge Win in Obus

Big news on the residency front!

For years we’ve been battling the New York tax department on the scope of its statutory-residency test, and yesterday brought a huge victory in that fight.  In Matter of Nelson Obus et al., v New York State Tax Appeals Tribunal, the court ruled that a seldom-used vacation home in New York cannot be considered a “permanent place of abode” for statutory residency purposes. Click here for the decision.

It’s Official: Pass-Through Entities Now Have Until September 15 to Make the 2022 New York Pass-Through Entity Tax Election

Last week we reported on the fast-paced legislative efforts to extend New York’s 2022 pass-through entity tax (PTET) election deadline. To read that article, click here. In record time, the bill we reported on was signed into law by Governor Hochul on May 6, 2022. 

Second Chance for Pass-Through Entities that Missed New York’s March 15 Election Deadline!

Last month we reported on recent legislative amendments to New York’s pass-through entity tax (“PTET”). To read that article, click here. It turns out the New York legislature is not done making amendments to the PTET.

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