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Which state do I collect in if I work from home, live in NJ, but was paid by NY firm?

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  • Which state do I collect in if I work from home, live in NJ, but was paid by NY firm?

    I live in New Jersey and I am employed by a company based out of NYC. I used to work in the NY office but for most of the past two years have worked from home in New Jersey greater than 90% of the time. I pay both NY and NJ state taxes in addition to the federal returns I file.

    NJ UE benefits are superior to NY and while I understand if I commuted into the city every day to work, I would HAVE to file in NY state, I think the issue is a little murky since I performed my actual work IN NJ. What happens with folks who are employed by NY firms but have sales territories in other states and thus live AND work in say, Texas. Where do you file?

  • #2
    Hard to say. I can say that all wages are reported to one state for UI purposes on a quarterly basis. If for the past 2 years, 90% of your time was spent working in NJ, then NJ should be the state. Now, does this mean that is who your employer reported your wages to? I have no idea what your employer actually did. You would normally file UI with NJ. It would not hurt to tell them that you have worked in both NJ and NY. It is possible for the states to work it out between them.

    State income taxes work under a very different set of rules then UI. NY's "for the convenience of the employer" rule greatly complicates NY-SIT in multi-state situations. Under the Interstate Reciprocal Coverage Act agreement, which both NJ and NY signed, there is only one state for UI wage reporting purposes, and the states are supposed to talk to each other on cross-state claims. However whatever the rules are, employers sometimes find it easier to report all UI wages to a single state. Not legal, but not uncommon either. Although if your employer is withholding NJ-SIT, it is less likely that they are playing that particular game.
    "Reality is that which, when you stop believing in it, doesn't go away".
    Philip K. **** (1928-1982)

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    • #3
      So do I file in both states?

      The problem with not being able to talk to a human being at either state's UE offices is that I don't know how to proceed. So do I file a claim with both NY and NJ? I don't want to get thrown in jail for filing false claims but how do I know that they will "work it out" between them? I can just file in both states of course but I am afraid that will be interpreted as an attempt to double-dip, which I am not doing but just not sure how to get NY to talk to NJ about my particular situation...

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      • #4
        It is not a "false claim". If you worked 90% in NJ, then that is the state where you would normally file in. HOWEVER, your employer reported your UI wage to exactly one state and no one on this website knows what that one state is. It should have been NJ under the IRCA rules, but employers sometimes take notions.

        File the claim with NJ as YOU are supposed to. If there are problems, then just tell them the truth, that you work 90% NJ and 10% NY. This is not uncommon, but it slows things up when it happens.
        "Reality is that which, when you stop believing in it, doesn't go away".
        Philip K. **** (1928-1982)

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