A company which continues to have a Pennsylvania resident working at home after June 30, 2021, may have sales tax nexus for 2021 and future years based solely on the activities of that employee. That includes, in part, engaging in any activity as a business within this commonwealth by any person, either directly or through a subsidiary, representative or an agent. There are hundreds of remote jobs available today, so be sure to utilize our job search here.The guidance also provides that a business has nexus with PA for sales tax purposes if it maintains a “place of business” in PA. There are many companies that welcome remote workers and already have systems in place to provide this opportunity. If you choose to move to a city that’s a lower-cost-of-labor market, check with HR to see if the decrease would be implemented if you planned to save money by moving to a new location, the move may not actually change your overall cost of living. In addition to tax ramifications, companies pay employees based on the cost of labor, not the cost of living, meaning you could be paid less for doing the exact same job depending on where you live. This can get tricky if you have to clock in at 5 am PST, a less desirable time for an 8 am EST shift which can cause workers to be less productive. Most companies also have set “core hours” during which they expect employees to be active. If the team is spread over different states this can be difficult. Similarly states have varying requirements for licensing and certification for some types of employees.Īlthough work and meetings can be done via online technology, some employers still expect staff to, at least occasionally, come into the office for face-to-face meetings or team building events. Each state has different labor laws relating to minimum wage, employee benefits, job hours and time off, so the company needs to understand and follow the rules for every state where they have an employee. Does a Remote Job Mean I Can Work Anywhere?ĭepending on the type of job and whether or not your employer is willing to take on the additional responsibilities of having an out of state employee, you might be able to work remotely from somewhere else. When you live in one state but work in another, the resident state typically provides a credit for taxes paid to the non-resident state in order to avoid double taxation. The only exception is if your employer directs you to work out of state for its convenience. If your employer is based in Connecticut, Delaware, Nebraska, New York, and Pennsylvania that have what’s called a “convenience rule,” those states have the right to impose an income tax on wages you earned while working for an employer based in that state, even if you choose to perform your job remotely meaning you could owe taxes in both states. Several states have also implemented “COVID-19 Rules” regarding tax implications for remote workers. Regardless of where your employer is based your taxes will always need to be filed in the state where you reside. There are rules governing taxation of people working remotely for in and out-of-state employers, and rules that trigger income tax for non-residents after they work in-state for more than a minimum amount of time or earn a minimum amount of money. Jobs like medical professionals, lawyers and teachers require in-state certification or licenses, so if an employer wants to hire someone out of state, they are limited to employees who are licensed in that state.Īll but nine states impose income tax and each sets its own parameters for determining who owes tax. A business that employs a worker out of state needs to be registered in that state and because of the paperwork, fees and taxes associated, the business might simply pass on hiring workers in a different state. Unfortunately it’s not as simple as determining whether an employee can do the work remotely. Tax Implications for Working a Job in Another State While it might be possible to work remotely in another state, there are some important considerations that both the employee and employer will need to discuss including taxes. With the changes in working environments from the pandemic, many have had a taste of working remotely or even from home and might wonder if they could continue working in that way if they move to another state.
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