Tax Residency

The New York State Department of Taxation and Finance conducts more residency audits and nonresident income allocation audits than any state in the nation. Hodgson Russ tax attorneys are at the forefront of many of these audits. In fact, high-ranking Tax Department officials have told us that Hodgson Russ handles more residency cases than any other law firm in the state.

We have numerous attorneys and paralegals dedicated to handling residency cases. Our team includes former residency auditors and the former head of tax enforcement at the Tax Department.

While many practitioners in this area need to read books and articles to understand how these residency cases work, the Hodgson Russ attorneys have literally written the book on New York residency audits. Tim Noonan[1], Paul Comeau [2]and Mark Klein [3]are co-authors of the 2018 “New York Residency and Allocation Audit Handbook,” published by CCH and of its previously published 2014 version. Tim’s monthly column in State Tax Notes, “Noonan’s Notes[4],” regularly addresses residency topics.

The firm also publishes an easy-to-read, comprehensive guide, What to Expect in a Residency Audit,[5] that many practitioners use as a guidebook for handling residency audits.

Our residency team has handled some of the most controversial and important residency cases over the past few years, including Matter of Gaied v. (NY) Tribunal, a 2014 victory in New York’s highest court that redefined the standard for taxation under New York’s statutory residency test. Many of these cases have received extensive coverage in publications such as Forbes, The New York Times” and “The Wall Street Journal,” to name a few.

What Is a New York Residency Tax Audit?

Taxpayers may get a letter from the New York State Tax Department (“Tax Department”) alerting them of an impending residency tax audit. Taxpayers affected by an audit will be investigated to determine whether they are residents or nonresidents of New York State and/or New York City. Since residents of New York State are subject to different taxes, the results can be significant.

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