Metro-North outage hearing should include telecommuting tax discussion

Re: “Blumenthal to quiz Con Ed, MTA execs in Bridgeport about Metro-North outage” (Oct. 21, 2013).

The Oct. 28 hearing on the Metro-North service disruption must include a discussion of the telecommuter tax – the harsh penalty that New York will impose on the Connecticut residents who worked from home for their New York employers during the outage.

The telecommuter tax derives from a New York State tax rule known as the “convenience of the employer” rule. Under the rule, nonresidents of New York who work for New York employers and choose to telecommute some or most of the time must pay taxes to New York on the wages they earn at home — outside New York — even though their home states can tax the same income.

As a result of the convenience rule, Connecticut residents who used the Internet to get to their New York offices when Metro-North could not take them will be double taxed on the wages they earned at home — once by Connecticut and then a second time by New York. These Connecticut commuters may have been following Gov. Dannel Malloy’s advice to telework during the crisis, but New York will fine them for doing so.

Telework is a crucial disaster-recovery tool, enabling a region to conduct business as usual even when catastrophic accidents or storms render rails and roads unusable. Connecticut residents should not be punished for using this tool. Members of Connecticut’s congressional delegation have previously introduced legislation that would abolish the penalty for telecommuting, prohibiting states like New York from taxing the wages that nonresidents earn in their home states. This legislation should be on the agenda at the Oct. 28 hearing. To maximize mobility — and minimize the risk of transportation-related losses — Congress should make the measure law.

 

 

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