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Do I pay taxes in two states if I work remotely?

Usually not. If you work fully remotely from your home state, you generally only owe taxes to that state — not your employer's state. The exception is if your employer is based in New York, which has a 'Convenience of Employer' rule that can still tax your income even when you work from home.

What is a reciprocity agreement?

Some neighboring states have agreements where residents only pay income tax to their home state, even if they physically commute to work in the other state. Examples include NJ/PA, VA/MD, and IL/WI. These apply to in-office commuters, not remote workers (since remote workers generally already owe only their home state).

My employer is withholding the wrong state's taxes — what do I do?

Submit a non-residency withholding exemption certificate to your employer's payroll or HR department. Each state has its own form. This tells your employer to stop withholding the wrong state's taxes and switch to your home state. You can also file for a refund of incorrectly withheld taxes when you file your returns.

What is New York's Convenience of Employer rule?

New York taxes income earned for a NY-based employer, even if you work from another state, unless your employer required you to work remotely. If you chose to work remote from, say, New Jersey, NY still considers that income taxable. This is one of the most aggressive state tax rules and affects many remote workers.

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