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Wayne K. Berkowitz CPA, J.D., LL.M.

Wayne K. Berkowitz CPA, J.D., LL.M.
Wayne Berkowitz, a tax partner and head of the State and Local Tax Group at Berdon LLP, advises on the unique requirements of governments and municipalities across the nation.
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Recent Posts

SALT TALK: You Are Forgiven – New Illinois Tax Provisions Include Generous Amnesty

Posted by Wayne K. Berkowitz CPA, J.D., LL.M. on Jun 17, 2019 11:30:00 AM

Readers who are fans of The Who will undoubtedly be aware that Pete Townshend proclaimed to all “You are Forgiven” in their 1966 song, “A Quick One, While He’s Away.” Some fifty-three years later, the State of Illinois wants to forgive you as well.

The amnesty is extremely generous in abating both penalties and interest for tax liabilities generated during the amnesty period. The amnesty period is defined as outstanding tax liabilities arising after June 30, 2011 and before July 1, 2018. The program will begin on October 1, 2019 and will end on November 15, 2019.

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Topics: SALT TALK

SALT TALK: Secret State and Local Tax Revealed

Posted by Wayne K. Berkowitz CPA, J.D., LL.M. on Jun 11, 2019 9:57:26 AM

Elvis Costello, soon to be recognized as an “Officer of the Order of the British Empire” (“OBE”), summed it up best when he penned the lyrics “She thought that I knew and I thought that she knew.[1]” This is exactly how I felt when colleagues, clients, friends and everyone else would ask me questions about the so-called “Jock Tax.” While I never knew what this super-secret mystery tax consisted of, I always thought I should know or at least my superiors certainly would.

So what is this Jock Tax we speak of? You mean you don’t know. All right, I will let you in on a secret. There is no Jock Tax. What we are referring to is simply the nonresident income tax. The same nonresident income tax that any of us are subject to if we perform services in a state other than our state(s) of tax residence.

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Topics: SALT TALK

SALT TALK: One Small Step (Backward) for Taxpayers, Many Giant Leaps for State Tax Departments

Posted by Wayne K. Berkowitz CPA, J.D., LL.M. on Jun 3, 2019 11:30:00 AM

Is it just me? Readers, have you noticed? Are state tax departments becoming more aggressive? Is this a brand new trend inspired by my tortured paraphrasing of Neil Armstrong’s famous statement upon exiting the lunar module at 10:56 PM on July 20, 1969 and the very recent release of a new documentary film about the Apollo 11 mission?

I think not. State tax departments have always been aggressive. What is new, in my opinion, is the emboldened stance taken by both tax departments and the state governments, which send the departments on their daily missions.

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Topics: SALT TALK

SALT TALK: I Read the (State Tax) News Today, Oh Boy

Posted by Wayne K. Berkowitz CPA, J.D., LL.M. on May 28, 2019 11:30:00 AM

I read the state tax news every day. Fifty states, numerous localities and the thirst for revenue practically insures that Berdon will need me when I’m sixty four and beyond. Well, I just had to laugh when I read that come June 1st the Beatles’ Sgt. Pepper’s Lonely Hearts Club Band album will turn fifty-two years old!

I asked several colleagues if I may inquire discretely as to their views and experiences as to the current state of state taxation for nonresident athletes and entertainers. While some said, nothing changed, it’s all the same, and others commented that it’s getting better all the time.

Well, it is Tuesday morning at 9:00 and “Lucy in the Sky with Diamonds” is playing in the background. I’m reminded somehow of the Berdon tagline Listen, Solve, Do and am inspired to do just that. 

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Topics: SALT TALK

SALT TALK: NYS Tax Department Confirms You Can’t Take it With You When You Go

Posted by Wayne K. Berkowitz CPA, J.D., LL.M. on May 20, 2019 11:30:00 AM

By now, my loyal readers are all well versed in the rules of residency. We are all aware what a difference a day makes and just as aware that days (specifically 184) are far from the only issue in determining residency status. The domicile test, separate and apart from the mechanical day counting attached to the statutory residency test, in and of its own can make you a resident.

New York has a highly developed as well as entertaining fact-specific body of case law examining the nuances attached to domicile determination. The most amusing of these tirades through the most intimate details of one’s personal life tend to revolve around the location of near and dear items.

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Topics: SALT TALK

SALT TALK: New Internet Taxes and Wayfair? Don’t Forget the Use Tax

Posted by Wayne K. Berkowitz CPA, J.D., LL.M. on May 13, 2019 11:30:00 AM

Many science fiction adventures have posited the idea of a parallel universe, but to my knowledge, we have not found intelligent life out there yet. Readers don’t fret. If you had your heart set on discovering a parallel universe, just take the lead of state government. Go out and create your own.

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Topics: SALT TALK

SALT TALK: Counting Days: The Tax Consequences of Getting Sick

Posted by Wayne K. Berkowitz CPA, J.D., LL.M. on Apr 23, 2019 10:00:00 AM

For those of you familiar with the comic strip Dilbert, my favorite strip ever involves Dilbert pointing out to his boss that they did an extensive research study and determined that forty percent of sick days are taken on Monday and Friday. (For those of you who don’t have similarly warped senses of humor, Monday and Friday are forty percent of the five day work week.) While New York doesn’t care what day of the week you are sick, getting ill in New York can have serious consequences for your day count and the statutory residency test.

Last post, I pointed out that there is “no shopping or dining exception” but fortunately there is a limited medical day exemption. The State’s Audit Guidelines have adopted a policy that confinement to a medical institution for any reason in New York does not constitute a day in New York. This policy is significantly more generous than the much harder stance taken by auditors in the past which essentially required the taxpayer to experience a significant medical emergency and be carted off to the hospital involuntarily.

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Topics: SALT TALK

SALT TALK: Counting Days - The Sun May Actually Rise in the West

Posted by Wayne K. Berkowitz CPA, J.D., LL.M. on Apr 15, 2019 11:30:00 AM

While most of us think of a day as the interval of light between two successive nights, taxing jurisdictions that look to the statutory residency test certainly had something much shorter in mind. While the New York statutes don’t bother to define what constitutes a day for purposes of the count, the regulations clearly state that “presence within New York State for any part of a calendar day constitutes a day spent within New York. . .”

Despite the broad reach of the regulations, two very limited exceptions are carved out. The first of these pertains to travel days within New York. If in New York solely to board a plane, ship train, bus, etc. to travel to a point outside of New York, this will not count as a day.

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Topics: SALT TALK

SALT TALK: 2019 - When is a Day Not a Day

Posted by Wayne K. Berkowitz CPA, J.D., LL.M. on Apr 8, 2019 12:02:01 PM

For those of you who have been following my blog, you know that one way to be taxed as a resident in New York State and/or NYC (collectively referred to as NY) is to be a statutory resident. One must have a permanent place of abode (PPA) and be present in NY for more than 183 days.

While understanding what constitutes a day in NY would seem to be a simple task, for the purpose of the statutory residency test this is simply not the case. Before we even explain how to count days and the various exceptions, the most important point to understand is that the burden of proof rests with you.

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Topics: SALT TALK

SALT TALK: NYS Budget Battle Settles on (Surprise!) Higher Transfer Tax and an Increased Mansion Tax

Posted by Wayne K. Berkowitz CPA, J.D., LL.M. on Apr 1, 2019 11:30:00 AM

In the ongoing NYS war over taxes, the additional surcharge on certain high-value non-primary residences in New York City, discussed in last week’s blog, proved to be a Mission Impossible. Intense lobbying by the NYC real estate industry and questions about enforceability sealed its fate. But never fear!

The Governor, New York State Assembly and New York State Senate finally agreed on the 2019 – 2020 State Budget late yesterday. The most significant provisions include an increase in the New York State Transfer Tax and the New York State “Mansion Tax” for certain properties located in New York City. The increases are effective for conveyances occurring on or after July 1, 2019. Binding written contracts entered into on or before April 1, 2019 will not be subject to the increases.

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Topics: SALT TALK

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