Telecommuting May Have Just Become A Lot More Expensive
from the uh-oh dept
Just as it looked like people were finally getting to be okay with telecommuting, the Supreme Court makes the whole process more expensive. Earlier this year we wrote about a programmer who was telecommuting from Tennessee to work for a company based in New York. He paid New York taxes on the portion of his income based on the time that he actually spent in New York, but the state decided that he needed to pay New York state taxes on his entire salary, saying that New York gave him the opportunity for the job, and basically, he owed them for it. While he lucked out because Tennessee has no income tax to add on top of that, telecommuters in other states wouldn’t be so lucky — and might have to pay state taxes in multiple states on their entire salaries. The original telecommuter appealed all the way up to the Supreme Court, but the Court has decided not to hear the case — meaning states are now free to start taxing out-of-state telecommuters on their entire salaries.
Comments on “Telecommuting May Have Just Become A Lot More Expensive”
Per Diem
That’s why you should hop around East Coast states and get half your income tax-free by calling it “per diem”. Silicon Valley folk aren’t very knowledgeable about this option, because California’s too big. If you maintain a residence in one state while working in another, it’s considered an economic “hardship”.
No Subject Given
If you don’t live in New York, you don’t want to come here. This kind of crap is typical. A few years ago, they were sending NYS tax agents into PA scouting for NY license plates in PA malls. Then they’d contact the owners of the cars trying to collect sales tax on items purchased in PA.
Non-resident state tax
Generally, if you live in a state with an income tax and you are liable to another state for taxes on income earned tin that nonresident state, you will get a credit on the home state tax liability.
Example: I live in NJ but work in NY. I pay tax to NY on my NY-sourced income (though not on my wife’s NJ-sourced income or our interest/dividends, etc). On our NJ resident income tax, we get a credit for most of the taxes paid to NY against our NJ tax.
Re: Non-resident state tax
Hello,
My question is as follows:
I live in NYC, and I work in NJ.
I pay NJ taxes, which are automatically taken away from my paycheck.
Do I have to pay NY taxes as well?!?
No Subject Given
What about tech support for every state? I remote control computers in other states all day long. Do I need to fill out 50 tax forms and pay taxes to every state?
Good ol' SCOTUS
Good ol’ SCOTUS; they can’t take the time to hear this important case, but they’re taking the time to hear that case on Anna Nichole Smith’s gold digging.
Hey, everyone, get the feeling this country isn’t yours anymore, if it ever was?
Re: Good ol' SCOTUS
No, it’s just you.
No Subject Given
Yet another reason to support the Fair Tax.
Re: No Subject Given
Think that’s screwy? I live in VA which sent me a tax bill a few years ago for the time I spent working overseas as a manager for the military retailer AAFES. Apparently they figured I must owe them the money since my tax return for the year in question was filed inside the country (Arizona) shortly after I returned from overseas. I explained when I got the bill, 3 years after I’d filed the return that: VA wasn’t my home of record though I’d lived here before going overseas, I wasn’t responsible for not taking out any state taxes – my employer was. AND being overseas I had no benefit of any state sevices whatsoever. I was given a choice, either setup a payment plan or have up to my ENTIRE paycheck garnished until the debt was paid. If this wasn’t bad enough, when I’d lost my job 3-4 years ago I was denied any state assistance (only time I’d ever asked for it) because I owned a car. I was told that I should sell my car and then I’d be qualified. Even though this areas lack of dependable public transportation would have made it far more difficult for me to get a job with no car.
Re: Re: No Subject Given
Oh yeah, that sounds exactly like the surreal collection bill I got from Loudoun County, VA, 5 years after I lived there. They demanded a “parking fee” of $107 for a car I sold soon after moving to Loudoun County, because parking a car in Loudoun County is a “privilege”. 5 years later in California, they sent me a collection bill, but I ignored it.
Will they send me another bill 5 years later?
why telecomute anywhere in particular
Just move the whole mess to tennessee, and forget about any new york infrastructure at all. This will eventually be a reason to leave anywhere that does not want to play fair over taxation.
No Subject Given
Can this be turned around? My company does business in all 50 states.
Perhaps any/all of my knowledge workers who live in states that have income tax are really telecommuting to states that don’t when they work every day. Wow, no taxable salary!!
And SCOTUS won’t here the case…! Bingo, we win!