Perry Cooper (Bloomberg Law): NY Tax on Remote Work Again Withstands Professor’s Challenge
New York’s strict rules for taxing remote work performed for in-state companies survived another legal attack after a state appeals court ruled Thursday that they conform to federal constitutional protections.
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Zelinsky asked the New York Supreme Court, Appellate Division, Third Department, to order the state to refund taxes imposed on his income when he worked remotely from his Connecticut home in 2019 and 2020, including when he couldn’t access his classroom because of Covid-19 restrictions.
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The professor will now turn his attention to an appeal to the state’s top court.
Cardozo Law School “was indifferent to the state from which faculty delivered videoconference lectures or conducted meetings,” so professor Edward Zelinsky wasn’t working from Connecticut for the school’s convenience, Justice Justin O. Corcoran wrote for the unanimous court. The New York Department of Taxation & Finance applies the state’s “convenience of the employer rule,” which allows it to tax the income of nonresidents who work remotely for New York-based companies unless telework benefits the business.
New York courts have been deferential to the state’s interpretation of its ability to tax income, but the pandemic raised new questions about whether the rule makes sense in an era of Zoom meetings and hybrid work. Connecticut and New Jersey officials have encouraged residents to challenge their tax bills in the hope of overturning the convenience of employer rule, though litigators said the case likely would have to reach the US Supreme Court for that kind of change to occur.
This is Zelinsky’s second attempt to take down the rule: the state’s top court rejected his prior constitutional challenge in 2003. He argued in both cases that New York violates the federal due process and commerce clauses by taxing activity beyond its borders, and that the work-from-home mandate during the pandemic further eroded the 2003 ruling’s analysis.
The appeals court acknowledged that some past applications of the convenience rule “resist ready application here” because of how the pandemic disrupted traditional work environments. “For instance, the cost-benefit analysis that previously informed voluntary choices about making a long commute to the office or furnishing suitable brick-and-mortar workstations became academic when congregating in person, at the office or elsewhere, was dangerous and temporarily prohibited,” it said.
But the court ultimately said that the focus on whether work must be done at a particular site for the employer’s need or benefit “remains a rational, practical test for work performed at an employee’s out-of-state home due to the pandemic.”
The case is Zelinsky v. Tax’n & Fin. Comm’r , N.Y. App. Div., 3d Dep’t, No. CV-25-1156, 7/2/26 .
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