If your employees are working out of state due to COVID-19, you may get some relief. A number of states established guidelines exempting businesses from state tax obligations if their employees work from home due to the pandemic. ![]() This obligation may include state income, gross receipts, and sales taxes. Most, but not all, states require businesses to pay several types of taxes to their state if they have a “business presence” there. There is a possibility an employee working in another state may trigger a tax obligation in that state due to nexus. Having an employee working in a particular state is sometimes enough to establish nexus, or “business presence” in that state. If you have remote employees working in multiple states, you will need to register in each, separate state. Depending on the state, you may also need to register with the state’s labor and unemployment agencies. You will likely need to register with state, and perhaps local tax agencies, as you will need to withhold income taxes from the state the employee will be working from. Register with the appropriate state agencies If you are one of those businesses, here are some things you need to know if you have employees who work in a state outside of where your business is located. Or, possibly, the employer finds themself willing to hire new, remote employees who reside in another state already. However, one of the concerns when working with a remote workforce is staying compliant with employment laws when one or more employees live in a different state than where the employer is located or a different state than where they previously worked for that employer. Many businesses have had positive results since moving to a remote work format. ![]() A remote work environment is a huge difference in the way work was conducted previously. ![]() Since early last year, employers have been challenged not only with shutdowns and layoffs but also with learning to work in a virtual world a format that many employers refused to move to in the past. The current pandemic has changed the way that we work in many ways.
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