Determination Form - New York Division Of Tax Appeals (Page 2 of 4) in pdf

York, NY to a home office at 258 Wahackme Road, New Canaan, CT. Unfortunately, the payroll

department did not pick up on that change, and the state and local taxes that were withheld were

sent to New York rather than Connecticut.

3. Toward the end of 1998, petitioner became employed by Winstar Wireless, Inc. ("Winstar"), a

telecommunications company. Petitioner joined the broadband division which was in the data section (the other

section was "voice"). Petitioner was running several offices around the United States which provided technical

services as a supplement to the data products which were offered by Winstar. At the beginning of 1999, all

(1)

functions of Winstar were located in New York City. Later in 1999, company operations moved to Virginia

where the majority of its employees were located. During 1999, the broadband division of Winstar was

dissolved. Petitioner's boss, Howard Taylor, left the company and "the data people were absorbed by the voice

people." There was an aggressive attempt by Winstar to save rent costs.

During the second quarter of 1999, petitioner was working primarily at coordinating transitions. He was then

brought into the technical side of the business, i.e., the technical enhancements to the communication products

that were being offered by Winstar. He developed telecommuting so that the employees of Winstar's customers

could operate in this way.

During the third quarter of 1999, petitioner was telecommuting to Virginia. However, he had an office at 685

Third Avenue in New York City. Petitioner began developing technical products that could differentiate

Winstar's offerings. The first product he worked on was a packaged set of software, integrating

teleconferencing, instant messaging, voice mail and email designed to support field personnel. Petitioner began

using these products himself in the course of his telecommuting from New York to technical staff in Virginia.

On September 30, 1999, he was "changed officially from line to staff" and he worked on technology

development for the company. He was forced to take a cut in pay to keep his job and was directed to move to

Virginia or, in the alternative, to work out of his home in Connecticut. Petitioner was assigned to work out of

Tysons Corner, Virginia, but Winstar would not pay for the move. Since, in 1999, he was 63 years old, he felt

that he had no choice but to accept the new terms of employment if he was to remain with Winstar. As of

September 30, 1999, petitioner became a formal member of the Virginia technical group and was transferred to

its payroll. His pay stub changed and his location code changed as well.

4. At the beginning of 1999, Winstar had 11 office locations in New York City. By the end of the year, all that

was left in New York City was upper management, consisting of marketing, legal, finance and real estate

divisions. No technical personnel were working out of New York City; all were relocated to Virginia.

5. After his official change on September 30, 1999, petitioner did not come into New York for any business

purpose. Petitioner's building pass for the office at 685 Third Avenue was rescinded, and petitioner was

informed that no office space would thereafter be available to him at the Third Avenue location or at any other

location in New York. On the day after he left the Third Avenue office, an employee of the marketing division

was occupying his desk. Petitioner did not speak to anyone in New York City concerning his job functions with

the company after September 30, 1999. Petitioner was paid by Winstar out of Virginia.

6. Petitioner introduced into evidence a letter from Donald S. Schneider, Winstar's senior vice president for

human resources, who held that position during the period in which petitioner was employed by Winstar. In

such capacity, Mr. Schneider monitored the placement and relocation of Winstar employees throughout the

corporation. Mr. Schneider's letter stated, in relevant part, as follows: " To the best of my knowledge Mr.

Devers was relocated from 685 3

Avenue, New York, New York, to an office in his Connecticut home. This

relocation was not done for the convenience of the employee but as an efficiency and cost containment

measure."

7. Due to an administrative oversight, Winstar continued to pay withholding taxes for petitioner to the State of

New York during the last quarter of 1999. Petitioner was later informed by Winstar that such withholding taxes

should have been paid to the State of Connecticut. He was instructed by Winstar to pay income tax to New

York for wages earned through September 30, 1999 and to pay tax to Connecticut thereafter. For the last quarter

Determination Form - New York Division Of Tax Appeals Page 2

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