Income/Franchise:
New York Appellate Court Reverses Tax Appeals Tribunal in Statutory Resident Case

Case No. 533310, N.Y. App. Div. (6/30/22). The New York Appellate Division, Third Department (Court), reversed a 2021 New York Tax Appeals Tribunal decision [see Decision DTA No. 827736, N.Y. Tax App. Trib. (1/25/21) for details on the earlier ruling] to hold that an individual domiciled in New Jersey who worked primarily in New York City (i.e., due to his employment, he spent more than 183 days in New York during each of the years at issue) and owned a vacation home in upstate New York that was determined to be a permanent place of abode (where he spent, at most, three weeks for each of the years at issue) was not a statutory resident for New York State personal income tax purposes under the facts. In doing so, the Court reasoned that the couple at issue did not utilize the in-state vacation home in a manner which demonstrates that they had a residential interest in the property as required by the New York Court of Appeals in Gaied. Citing Gaied, the Court stated that “[t]he taxpayer must have utilized the dwelling as his or her residence; maintaining a dwelling that could be a permanent place of abode is not enough to establish status as a statutory resident,” which is a fact-intensive inquiry.

See forthcoming Multistate Tax Alert for more details on this ruling, including some related taxpayer considerations, and please contact us with any questions in the meantime.