Connecticut Incentivizes Suits Against NY and other states with “Convenience” laws

The CT Legislature recently passed a bill signed by their governor that will pay a CT resident for suing New York when challenging NY’s tax on remote workers. CT will give them 60% off their CT tax bill as a reward. 

Some background is in order here: NY is one of a handful of states that taxes remote workers for NY firms when their location of work outside of NY is their personal convenience and not the NY employer’s requirement. For example, a NY employer has a job that requires their presence in CT vs an employee working remote for the NY firm without a requirement to be in CT. This costs CT tax revenue as they have to allow a credit for taxes paid to NY.  

The CT bill does not name NY specifically, but it comes as no surprise, with the large number of remote workers residing across the border in CT, that they have NY in mind. The reward could also be earned for suing Nebraska, which also has such a rule.  

As an added incentive, the law is retroactive to 2020, when the pandemic saw many workers go remote and any penalties / interest accrued for being delinquent on the CT taxes regarding the amount being challenged.  

And the craziest thing about the bill is that it was passed 148-0 in the CT house and 36-0 in the CT Senate – talk about bipartisanship. 

Reference SB 1558 CT General Assembly