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SALT TALK: "I'm Just a Bill" - Mobile Workforce Legislation (Re)Introduced

Wayne Berkowitz CPA, J.D., LL.M. 04.03.2017 | SALT TALK

There is a joke that starts with three mothers sitting around discussing the professions of their respective sons. The first mother bragged about her son the doctor and all were impressed. The second mother chimed in that her son was a lawyer and everyone smiled. The third mother sheepishly stated her son was an accountant. All shrugged and one of the mothers interjected, that's ok, he always was a little slow.

Well, I'm no doctor, but I am a lawyer and an accountant and I still can't explain where or what happened to the mobile workforce legislation we have been promised for so long1. Yet to my surprise, just last month the "Mobile Workforce State Income Tax Simplification Act of 2017" comes barreling down the tracks 2.

The Act's own summary explains it best:

This bill prohibits the wages or other remuneration earned by an employee who performs employment duties in more than one state from being subject to income tax in any state other than: (1) the state of the employee's residence, and (2) the state within which the employee is present and performing employment duties for more than 30 days during the calendar year.

The bill exempts employers from state income tax withholding and information reporting requirements for employees not subject to income tax in the state under this bill. For the purposes of determining penalties related to an employer's state income tax withholding or reporting requirements, an employer may rely on an employee's annual determination of the time expected to be spent working in a state in the absence of fraud or collusion by such employee.

For the purposes of this bill, the term "employee" excludes: professional athletes; professional entertainers; production employees who perform services in connection with certain film, television, or other commercial video productions; and public figures who are persons of prominence who perform services for wages or other remuneration on a per-event basis.

Identical versions were introduced in the House and Senate. If the President gets "on board," simplification can finally become a reality.

If you think you might qualify and require some guidance, contact me at wberkowitz@berdonllp.com or your Berdon advisor.

Wayne Berkowitz, a tax partner and head of the State and Local Tax Group at Berdon LLP, advises on the unique requirements of governments and municipalities across the nation.

For those of you wishing to save on legal fees and law school tuition, I recommend the following brief video from my childhood which will clearly explain the legislative process. Feel free to send it to your local lawmaker to refresh their memory. https://www.youtube.com/watch?v=tyeJ55o3El0.

2 Please excuse the bad train metaphor. On the LIRR this morning, the conductor announced very grimly, "We have reached Penn Station, our final destination." No matter how bad of a Faustian bargain you have made, I wish this on no one.

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