House Committee Bill Would Restrict Taxation, Withholding of Multi-state Workers

Thanksgiving may have been on the mind of legislators as legislation was approved by a voice vote of the House Judiciary Committee on Nov. 17 that would stop states from requiring nonresident workers to pay income tax for less than 30 days of work performed in the state .

The Mobile Workforce State Income Tax Simplification Act would require employees’ earnings to be subject to state income tax and withholding if the employee performs work in the state for more than 30 days during the calendar year. The bill would create a national framework on how to tax mobile workers as a way to clear up a lack of consistency in the states, according to lawmakers.

This has always been an area of confusion with employers particularly as states look to increase tax revenues with increased enforcement of withholding regulations on multi-state workers. This legislation would relieve a lot of the headaches employers suffer through in complying with the withholding regulations for short-term out of state jobs. Employers will be relieved if this legislation becomes law. Time will tell.

Speaking of the holiday, all the staff  here at Time & Pay wants to wish you and yours a Happy Thanksgiving! We all have much to be thankful for in this great country we live in.