Becker Truster’s Post

Remote – or “virtual” – work has become ubiquitous since the pandemic sent millions of people home to work from dining room tables, couches and home offices. In some cases, employees are working from homes that are in a different state than the one in which their employers are located. This is especially true in smaller states and in large metropolitan areas located near state lines, like Kansas City. If your company is growing and expanding into other states, or if you have employees who live across state lines, several considerations can help you anticipate and manage the state and local tax (SALT) implications. Read this post from Susan Day and Jason Higgins for more information. #SALT #CPA #Tax #Accounting

As remote work becomes more ubiquitous, tax law and other regulations will have to adapt. Here's an example of how some states produce a "double taxation" problem for remote workers.🔍 🏠 Remote Work's Tax Implications: With the surge in remote work since COVID-19, employees face new tax challenges. The location of both the worker and the employer can dictate tax liabilities, potentially leading to complex multi-state tax situations. 💼 Dual Taxation Risk: In most cases, working across state lines won't lead to double taxation due to credit systems. However, in states with 'convenience of the employer' rules, like New York, Connecticut, Delaware, Nebraska, and Pennsylvania, remote workers might face taxes in both their state of residence and their employer’s state. 📊 Understanding 'Convenience of the Employer' Rules: These rules allow certain states to tax non-resident employees of in-state companies. This can lead to scenarios where remote workers owe income tax to a state they don’t physically work in. 🔄 Reciprocity Agreements and Credits: Some states have agreements that simplify tax obligations based on residency, not work location. These reciprocity agreements, along with tax credits, help prevent double taxation. For example, a Maryland resident working remotely for a Pennsylvania company only needs to file taxes in Maryland, thanks to a reciprocity agreement. However, without such agreements, workers might need to file tax returns in both states but can often claim a tax credit to avoid double taxation. 🔑 Takeaway: Taxes can get complicated, but we need to understand the commitments in the short-run, and serve as a force for good to influence reforms that promote innovation and well-being longer run; employers should pay attention to these reciprocal agreements! #RemoteWork #TaxSeason2024 #StateIncomeTax #Telecommuting https://lnkd.in/eT3iZEap

Where should you file your taxes if you are a remote worker? Remote work is a flexible setup where employees perform tasks outside a company facility, whether they work from home, in co-working spaces, or in other locations not at the agency’s site. The freedom of remote work can raise many questions about taxes, including where they should be filed and who is responsible for withholding income. Click here to learn more about what remote workers should know about their tax obligations: https://lnkd.in/eZNcdDSQ #remoteemployee #workfromhome #taxes

As the remote work trend continues, it is imperative for employers and employees to understand the state and local tax issues related to remote work. In this Tax Executives Institute article, Eugene Gibilaro and Josh Sivin discuss these challenges and provide practical advice for navigating them. #remotework #taxlaw #stateandlocaltax

Embracing remote work post-pandemic? 🏡👩💼 Uncover the tax implications that come with the new normal! From the benefits of reduced costs to the complexities of tax nexus, small and medium-sized businesses need to navigate the remote landscape wisely. #RemoteWork #WFH #Taxes #HensslerFInancial https://ow.ly/yjy950QrKVx

Things to think about for the future of hybrid and remote workers. Double taxing could be on the horizon depending on where your company is located.

Hey everyone! 👋 As small business owners, one of the biggest shifts we've seen recently is the move to remote work. It's been a game-changer in many ways, but it also brings some unique challenges, especially when it comes to taxes. Let's dive into it! 📊 Increased Deductions Remote work means more home offices. 🏠 This opens up opportunities for home office deductions, which can be a lifesaver. Make sure to document your expenses thoroughly to maximize these deductions. Multi-State Taxation If your team is spread across different states, things can get tricky. Each state has its own tax rules, and you might end up dealing with multi-state tax obligations. 🗺️ It's crucial to stay informed and perhaps even consult with a tax professional to navigate these waters. Employee Reimbursements With remote work, you might be reimbursing employees for home office expenses like internet, equipment, and more. 💻 These reimbursements can be deductible for the business, so keep track of them! Payroll Adjustments Don't forget about payroll taxes. If your employees have moved to different states, you need to adjust your payroll systems to comply with state-specific tax requirements. This is an area where getting it right is essential to avoid penalties. Personal Experience From our own experience at Square Accounting, embracing remote work has been a double-edged sword. While the flexibility is fantastic, the tax complexities can be overwhelming. Last year, we had to hire a tax advisor to ensure we were compliant across several states, and it was worth every penny. 💰 Conclusion Remote work is here to stay, and with it comes a new set of tax considerations. Stay proactive, keep excellent records, and don't hesitate to seek professional help when needed. What tax challenges or opportunities have you faced with remote work? Drop your thoughts in the comments! 👇 #smallbusiness #remotework #taxtips #homeoffice #businessgrowth #square #entrepreneurlife

Remote work comes with its perks, but tax planning can be tricky! From home office deductions to travel expenses, there are key opportunities to maximize your savings. At JCG Tax, we specialize in helping remote workers and small businesses optimize their deductions and ensure compliance. Let’s work together to make tax season a breeze! Click here 👉 https://lnkd.in/eKWBzjff #RemoteWork #TaxPlanning #SpringfieldTaxExperts #JCGTax

Navigating the NY's Convenience of the Employer Rule is crucial for employees and businesses as the landscape of remote work continues to evolve. Recent rulings have upheld the rule, which requires certain out-of-state workdays to be treated as New York workdays for tax purposes. As challenges to the rule continue, understanding its implications remains essential for employers and employees alike. https://lnkd.in/eT_DYWct

Navigating Tax Implications of Remote Work Remote work has revolutionized the way we approach our professional lives, offering flexibility and the opportunity to work from virtually anywhere. However, this shift comes with its own set of tax implications that both employees and employers need to be mindful of. For Employees: 1. Understand Multi-State Taxation: If you're working remotely from a different state than your employer, you might be subject to state taxes in both locations. Research and understand the tax obligations for each state to avoid surprises come tax season. 2. Home Office Deductions: While employees may not be able to claim home office deductions under current tax laws, self-employed individuals and freelancers can. Ensure your home office meets the IRS requirements to take advantage of these deductions. 3. Stay Informed on Local Laws: Tax laws can vary significantly by state and locality. Keep abreast of any changes that might affect your tax liabilities. For Employers: 1. Nexus Considerations: Remote employees can create tax nexus in states where your company previously had no presence. This can lead to new tax obligations. Regularly review your nexus status and seek professional advice if needed. 2. Withholding Requirements: Ensure compliance with state and local tax withholding requirements for your remote workforce. Different states have different rules, and non-compliance can result in penalties. 3. Reimbursement Policies: Establish clear policies for reimbursing remote work expenses. Some states have specific regulations around this, and having a clear policy can prevent misunderstandings and ensure compliance. Navigating these complexities can be challenging, but with the right knowledge and proactive measures, both employees and employers can effectively manage the tax implications of remote work. Staying informed and seeking professional advice when necessary can help mitigate risks and ensure compliance. #RemoteWork #TaxPlanning #WorkFromHome #TaxImplications #ProfessionalGrowth #Compliance