Tax Relief

Tax breaks for CT residents who make money working from home for companies in New York or Massachusetts obtain closing approval

News 12 employees

March 01, 2021 at 7:11 p.m. EST

Updated on:March 01, 2021 at 7:11 p.m. EST

The tax break for Connecticut residents who work from home for businesses in New York and Massachusetts was finalized in state law on Monday.

It prevents Connecticut residents from being “double taxed” by giving them a special tax credit for income taxes they paid in New York or Massachusetts, even if they work from home. The move affects around 80,000 employees.

The bill also restructures payments to cities in lieu of taxes.

Critics call it a commuter tax levied by New York and Massachusetts. There is currently a federal lawsuit pending whether these states have the right to collect income taxes from citizens if they are currently physically working in Connecticut.

Connecticut legislature says with the lawsuit pending, they didn’t want residents to be taxed twice.

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