Progress of the Mobile Workforce State Income Legislation

The Mobile Workforce State Income Tax Simplification Act of 2011 (HR 1864) was introduced to the House by Rep. Howard Coble on May 12, 2011 and referred to Committee the same day. HR 1864 was then reported by Committee on November 17, 2011. The bill is aimed to lower administrative tasks for employers who have employees traveling and working in multiple states and tax filing burdens of the employees themselves.

The main concern is states are inconsistent with the current requirements for traveling employees filing personal income tax returns and for employers withholding income tax on those traveling employees.

Staying true to the current law, the bill still maintains that the employee’s earning are subject to full tax in his/her residing state. The bill creates a 30 day period that traveling employee’s earning will be exempt from tax and withholding from the state in which they are traveling.

Employees who conduct business in a their nonresident state for more than 30 days during the calendar year will remain subject to the appropriates state’s taxes and the employer will be responsible for withholding the appropriate taxes.

The next step for the bill to become a law is for it to pass in the House and then the Senate.

For updates as the Mobile Workforce State Income Tax Simplification Act goes through legislation, check back with the Optimum blog frequently.

**Read the updated status of The Mobile Workforce State Income Tax Simplification Act.

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IS Manager Michael Fox, Lexington Center

I want to thank each of you for your assistance with our W-2 processing. I was able to balance to the penny for all employees.