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Armed with the federal Constitution and plenty of passion, a professor at Benjamin N. Cardozo School of Law Wednesday brought his crusade to topple New York’s controversial tax laws to an appellate panel in Albany, N.Y. Edward A. Zelinsky, a tax professor who lives in New Haven, Conn., and frequently works from home, is challenging what he considers unconstitutional double taxation resulting from New York’s “convenience of the employer standard.” Since Zelinsky works for a New York entity, he is liable for New York taxes. However, since he lives in Connecticut, which bases taxation on residence rather than source, Zelinsky also has to pay Connecticut taxes. That, he claims, violates the equal protection and commerce clauses of the U.S. Constitution. New York, however, stands by its taxing procedures, both constitutionally and as a matter of policy. Zelinsky v. Tax Appeals Tribunal, 91216, stems from income tax returns Zelinsky and his wife, Doris, filed for 1994 and 1995. On those returns, the professor apportioned his law school income and claimed he owed New York only for the days he was physically present at Cardozo Law School, located in New York City. Zelinsky maintained that New York had no right to tax him for the days he spent researching, preparing exams and writing at his home in New Haven. The New York Division of Taxation rejected his arguments, as did an administrative law judge and the Tax Appeals Tribunal. Nearly a year ago, the tribunal said that if Zelinsky has a gripe, it is with Connecticut. Connecticut disagrees, and its tax commissioner and attorney general filed an amicus curiae brief in support of Zelinsky. The matter has generated considerable interest among Northeastern tax officials because of its implications for telecommuters. In fact, the North Eastern States Tax Officials Association has urged a multijurisdictional agreement that would prevent predicaments like Zelinsky’s, but New York, which is collecting some $100 million annually from out-of-state residents, is reluctant to sign on. EMPLOYER’S CONVENIENCE At the heart of the dispute is the so-called “convenience of the employer” standard. All but four of the 41 states with income taxes permit apportionment based on where the income was earned. Most of them afford taxpayers a credit for taxes paid to other states. New York, however, grants credit only when the employer requires the taxpayer to work out of state. Under New York law, someone who works for a New York firm at an out-of-state location for convenience is liable for New York taxes. Someone who works for a New York firm at an outside location because of a requirement of the employer is not liable. The policy justification for the rule is that many people who work in New York live in neighboring states, and it would be unfair to subject state residents who work at home to a tax not shared by out-of-staters. Additionally, officials want to discourage out-of-state residents from working at home simply to avoid New York’s higher taxes. The result for Zelinsky is that when he works at home, he is taxed twice. But another professor who teaches at Cardozo and works from a home in New York is not. Several taxpayers have challenged the rule unsuccessfully. But almost all of them claimed they had to work out of state, and therefore the physical location of their laboring was not a matter of personal convenience. Zelinsky, however, took a different track. He does not deny that working from home is a matter of convenience. But he claims New York cannot perpetuate double taxation without violating the due process and commerce clauses. INTERSTATE ACTIVITY Wednesday marked the first time Zelinsky has had his case before the judiciary, and the pro se professor urged the justices to discard decades of New York tax procedure and tradition. He argued that policies that may have been justified in the days when New York’s neighbors did not have income taxes, and thus were potential tax havens for people working in the Empire State, have no application today. He refused to concede that all of his Cardozo income is New York-sourced, and maintains that when the physical activity occurs elsewhere the labor cannot be construed to have occurred in New York. New York Assistant Attorney General Andrew D. Bing, arguing for the state, countered that Zelinsky relies on the “fallacy” that the activity in which he is engaged — teaching — is an interstate activity, such as running buses or transporting gas through lines that cross state borders. He also suggested that Zelinsky benefits from the New York taxes he pays, pointing out that if Cardozo law school catches fire, New York firefighters will come to the rescue and ensure that Zelinsky has a job to return to. Zelinsky, in rebuttal, immediately pounced on that point. “If the law school catches fire, tax the law school,” Zelinsky said. “New York does not have the right to say, “We are going to tax you for services you could have used if you came into New York.’” Bing and Zelinsky also clashed over the potential consequences of the case. The assistant attorney general cautioned the court against issuing a ruling that would cost the state significant revenues and perhaps establish a framework for abuse. He said the state could be placed in an impossible situation of having to determine whether an out-of-state resident was actually performing work from home, or just making that claim to avoid taxes. Zelinsky suggested that if the judges were to consider the ramifications of the case, they also ought to recognize that jobs could be driven out of New York by the current law, and that the policy could encourage retaliatory tax policies by other states. On the panel were Justices Thomas E. Mercure, Robert S. Rose, Edward O. Spain, D. Bruce Crew III and John A. Lahtinen. A decision is likely before the end of the year.

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