New York State and New York City Residency Tests

New York State Tax Residency Rules

Whether an individual is considered a resident of New York State or City can have a material impact on the individual’s income tax liability. A New York State resident is generally subject to New York State income tax on his or her worldwide income, whereas a nonresident is subject to New York State income tax only on income from New York State sources. The difference is even more significant in New York City. A New York City resident is generally subject to New York City income tax on his or her worldwide income, while a nonresident is not subject to New York City income tax regardless of the source of his or her income. The cost of New York State and City tax residence status is even greater now that any federal deduction for state and city taxes has been substantially eliminated.

New York State applies a multipart tax residency rule based on whether you have your domicile in New York or are a statutory resident based on spending more than 183 days during the calendar year in New York State and have a permanent place of abode in New York during a significant portion of the year.

Generally, you are considered a New York State resident for income tax purposes if you are domiciled in the state. The terms domicile and residence are often used synonymously, but for New York State income tax purposes, the two terms have distinctly different meanings. In general, your domicile is your permanent and primary residence that you intend to return to or remain in after being away (for example, on vacation, business assignments, educational leave, or military assignment). Residence means a place of abode. An individual may have several residences—e.g., houses, apartments, condos, and/or other places to live or physical dwellings in which they reside—and some may be in different states. However, while you may have multiple residences, you can only have one domicile. An individual may live in a certain residence for a temporary period of time, which could be an extended period of time, but if it’s not the place they ultimately attach themselves to and intend to return to, it’s still not your domicile. Furthermore, your New York domicile does not change until you can demonstrate with clear and convincing evidence that you have abandoned your New York domicile and established a new domicile outside New York State. This means shifting the focus of your life to the new location. It is not enough simply to file a certificate of domicile or register to vote in the new location. All aspects of a person’s life is considered in determining whether a person’s domicile has changed.

Statutory Residency Test

You may be subject to tax as a resident even if your domicile is not New York under the statutory residency test. You are a New York State resident if your domicile is New York State OR:

• you maintain a permanent place of abode in New York State for substantially all of the taxable year; and
• you spend 184 days or more in New York State during the taxable year. Any part of a day is a day for this purpose, and you do not need to be present at the permanent place of abode for the day to count as a day in New York.

In general, a permanent place of abode is a building or structure where a person can live that you permanently maintain and is suitable for year-round use. It does not matter whether you own it or not.

New York Tax Regulations provide the following guidance on what is a permanent place of abode: "A permanent place of abode means a dwelling place of a permanent nature maintained by the taxpayer, whether or not owned by such taxpayer, and will generally include a dwelling place owned or leased by such taxpayer's spouse. However, a mere camp or cottage, which is suitable and used only for vacations, is not a permanent place of abode. Furthermore, a barracks or any construction which does not contain facilities ordinarily found in a dwelling, such as facilities for cooking, bathing, etc., will generally not be deemed a permanent place of abode. A dwelling place maintained by a full-time student enrolled at an institution of higher education, as defined in section 606 (t)(3) of the Tax Law, in an undergraduate degree program leading to a baccalaureate degree, and occupied by the student while attending the institution is not a permanent place of abode with respect to that student. A full-time student is an individual who is carrying a minimum courseload in such program of 12 credit hours per semester for at least two semesters, or the equivalent, during the individual's taxable year." N.Y. Comp. Codes R. & Regs. Tit. 20 § 105.20. Determining what constitutes a permanent place of abode requires a facts and circumstances inquiry in some instances. For example, in a recent New York case, an infrequently used vacation property in which the taxpayer did not keep personal effects was found to not constitute a permanent place of abode for a taxpayer who was domiciled in New Jersey. See In Matter of Obus (June 30, 2022).

Special Exceptions to New York State Residency Status

Exception: If your domicile is New York but you meet all three of the conditions in either Group A or Group B, you are not a New York State resident.

• Group A
• You did not maintain any permanent place of abode in New York State during the tax year; and
• You maintained a permanent place of abode outside New York State during the entire tax year; and
• You spent 30 days or less (a part of a day is a day for this purpose) in New York State during the tax year.

• Group B
• You were in a foreign country for at least 450 days during any period of 548 consecutive days; and
• You, your spouse (unless legally separated), and minor children spent 90 days or less in New York State during this 548-day period; and
• During the nonresident portion of the tax year in which the 548-day period begins, and during the nonresident portion of the tax year in which the 548-day period ends, you were present in New York State for no more than the number of days which bears the same ratio to 90 as the number of days in such portion of the tax year bears to 548. The following formula illustrates this condition: (number of days in the nonresident portion/ 548) × 90 = maximum number of days allowed in New York State.

New York City Residency Rules

The requirements to be a New York City resident are the same as those needed to be a New York State resident. You are a New York City resident if:

• your domicile is New York City; or
• you have a permanent place of abode in New York City and you spend 184 days or more in the city.

All city residents’ income, no matter where it is earned, is subject to New York City personal income tax. Nonresidents of New York City are not liable for New York City personal income tax. The rules regarding New York City domicile are also the same as for New York State domicile. The New York State Department of Taxation and Finance administers both the New York State and New York City personal income taxes. If your permanent and primary residence that you intend to return to and/or remain in after being away is located in one of the five New York City boroughs (Manhattan, Brooklyn, Queens, the Bronx, and Staten Island), it is considered a New York City domicile. Your New York City domicile does not change until you can demonstrate with clear and convincing evidence that you have abandoned your city domicile and established a new domicile outside New York City. Even if you live in a location outside of the city for a period of time, if it’s not the place you attach yourself to and intend to return to, it’s not your domicile. Your domicile will still be New York City and you will still be considered a New York City resident.

Yonker's Tax Residency

Yonkers is not in New York City and is not one of the 5 boroughs that comprise New York City (Manhattan, Brooklyn, Queens, the Bronx, and Staten Island). Yonkers has its own income tax. For income taxes purposes, Yonkers resident status depends on where you were domiciled and where you maintained a permanent place of abode during the taxable year. Similar to New York State and New York City requirements, if your domicile is Yonkers, you are considered a Yonkers resident. If you maintain a permanent place of abode in Yonkers and spend 184 days or more in Yonkers, you are considered a Yonkers resident. The rules regarding Yonkers domicile are also the same as for New York State domicile. You can only have one domicile. Unless you can demonstrate with clear and convincing evidence that you have abandoned your Yonkers domicile and established a new domicile outside Yonkers, your Yonkers domicile remains unchanged. Yonkers residents are subject to a Yonkers resident income tax surcharge that is computed and reported on their New York State tax return. Nonresidents of Yonkers may be subject to the Yonkers nonresident earnings tax if they:

• earn wages or carry on a trade or business there; or
• are a member of a partnership that carries on a trade or business there.

Counting Days in New York

For New York State, New York City and Yonkers residency purposes, any part of a day spent in New York counts as a day. You do not need to be present at your permanent place of abode for the day to count as a day in New York, as per N.Y. Comp. Codes R. & Regs. Tit. 20 § 105.20. For example, if you arrive in New York State on January 1 at 11:00 PM and leave on January 2 at 1:00 AM, you have spent two days in New York State even though you were only there for two hours. Specifically, New York Tax Regulations state: "In counting the number of days spent within and without New York State, presence within New York State for any part of a calendar day constitutes a day spent within New York State. See Matter of Zanetti v. New York State Tax Appeals Tribunal, 128 A.D.3d 1131 (3d Dept. 2015) (holding that any part of a day in New York counts as a full day for purposes of the 183-day statutory resident test; in this case, during the year at issue, the taxpayer spent 172 full days outside of New York, 167 full days in New York and parts of 26 days at his New York home—either leaving or arriving via private jet on each of those 26 days; held each of the 26 partial days constituted a day in New York, bringing the taxpayer's total days in New York to over 183 and thus resulting in taxpayer being a NY resident for income tax purposes).

However, presence within New York State may be disregarded if such presence is solely for the purpose of boarding a plane, ship, train or bus for travel to a destination outside New York State, or while traveling through New York State to a destination outside New York State. For example, if a Connecticut resident travels to JFK airport to board a plane to Europe, the day is not counted toward presence in New York State. See NY Nonresident Audit Guidelines.

In deciding what level of extraneous activity makes presence in New York not incidental to the travel, the relevant criteria are (1) whether the traveler's activity is incidental to his presence for travel purposes and (2) the degree of control the taxpayer exercises over his travel arrangements. For example, someone who arrives a day early for a cruise, in order to attend a business meeting, would be present for that day, whereas time spent by someone who visits a friend during an unavoidable delay or stopover would not count as a day present in New York. Quite often, activity incidental to travel takes place on route to, or at a transportation terminal. Such activity as the purchase of meals or other items at a terminal, access to an automatic teller machine (ATM), stopping for gas or a meal while driving through New York, stopping to pick up a traveling companion on route to the terminal, parking the car in New York in order to meet a limousine or other conveyance that takes the individual to the airport or terminal should not change the treatment of this day as a travel day for the purpose of the 183-day count. See NY Nonresident Audit Guidelines.

Burden of Proof and Record Keeping Requirements

Any person domiciled outside New York State who maintains a permanent place of abode within New York State during any taxable year, and claims to be a nonresident, must keep and have available for examination by the Department of Taxation and Finance adequate records to substantiate the fact that such person did not spend more than 183 days of such taxable year within New York State." N.Y. tax regulations provide that a person bears the burden of proof to establish their locations throughout the year. New York Courts have made clear that the burden of proof is on the taxpayer to prove their location on each day during the year. See In the Matter of the Petition of Boniface, New York Tax Appeals DTA No. 829018 (April 29, 2021) (Taxpayers deemed New York residents despite being in the state for fewer than 184 days because they failed to provide credible evidence to prove they spent the majority of the year elsewhere. The tribunal found their documentation, which included unsworn statements and calendars with discrepancies, insufficient to meet the burden of proof required to establish a new domicile outside of New York. Tax auditors subpoenaed Verizon phone records.). Use the Domicile365 App to record a detailed day-by-day log of your location that is essential to substantiate your residency status. The Domicile365 App makes it easy to track your days in New York State, New York City, Yonkers and other cities in New York State for tax residency purposes.

Conclusion

Understanding New York State, New York City and Yonkers residency rules is crucial for managing day counts, tax planning and compliance. Download the Domicile365 App to track your days in New York State, New York City, Yonkers and other cities in New York State. Signup for a free 60 day trial. The Domicile365 App is available for both Apple iOS and Google Android. The Domicile365 App makes it easy to track your days in New York State, New York City, Yonkers and other cities in New York State for tax residency purposes.