(The Center Square) — The city of Cleveland has to pay a South Carolina man $18,000 for taxes it collected using a COVID-era law that was eventually stopped by lawmakers.

Anthony Alfieri, who lives in Hilton Head, worked for a Cleveland-based financial services company from his South Carolina home. The city tried to tax commissions The Buckeye Institute said were illegally taken in 2021 and 2022, and the city has refunded more than $18,000.

“As with The Buckeye Institute’s client Dr. Manal Morsy, Cleveland had no legal authority to tax income Mr. Alfieri earned while working at his home in South Carolina,” said Jay R. Carson, senior litigator at The Buckeye Institute and the lead attorney representing Mr. Alfieri. “In issuing Mr. Alfieri a refund, Cleveland has done the right thing.”

Alfieri earned commissions on deals and was typically paid several months or years after the work that generated the commission.

In 2023, according to The Buckeye Institute, he was paid for several deals that happened in 2020-2021, and Cleveland taxed those commissions under the state’s then-pandemic law.

The Ohio General Assembly passed legislation at the beginning of the pandemic that allowed cities to continue to collect taxes from workers even though they worked remotely in another city rather than working in the city where the employer was located. It was an effort to stabilize revenue for municipalities, and, in particular, larger communities, where larger employers are based.

The House passed a bill in June 2021 that required employees to pay income taxes in the city where they work. If work is done at home, then that community benefits, rather than where the traditional workplace is located.

In 2015, Cleveland lost a similar, ruling “”[l]ocal taxation of a nonresidents’ compensation for services must be based on the taxpayer’s location when the services were performed.”

Cleveland also abandoned its appeal in a similar case involving Morsy.