Telecommuters May Owe Extra State Taxes

marct22 writes "According to Cnet News, the US Supreme Court refused to hear an appeal by a Tennessee programmer who was forced to pay extra taxes because he was telecommuting to a job in New York. Apparently he worked in NY 25% of the time, which he didn't argue about, but the other 75% of the time he worked from home in Tennessee, which doesn't have income taxes. Also, it appears that right now, for those of us who live in one state and telecommute in another may be doubly taxed if both have income tax. There is a Telecommuter Tax Fairness Act in the Senate, but it has not emerged from committee so has not been voted on."

Comments

Re:SSH? VNC?

[TheOtherAgentM]

Seriously, I would owe taxes in a lot of states if this were taxable. Shouldn't you just tax a person in his place of employment if he is a remote worker?

Re:And his point is???

[Angostura]

Speaking as someone who lives in London, UK, and is employed by a New York-based company, and pays UK taxes, I think I see a flaw in your argument.

You're missing the point

[Crazy Man on Fire]

Taxes pay for the services that you use. Is this guy using the roads to get to work? Are his kids going to the schools? No! Why should he pay for that stuff? The taxes he pays in his home state cover this stuff in his home state. The people who live in the other state should be paying for those services provided there.

Re:You're missing the point

[Soko]

Besides, does this guy get to vote in New York State elections now? If not, it's taxation without representation.

Soko

Re:You're missing the point

[iambarry]

If not, it's taxation without representation.
Lots of taxes are without representation. Non-citizens pay taxes, but don't vote. If you travel to another state and purchase goods you may pay sales tax, but not vote. I work in another state and pay plenty of taxes there, but can't vote there.

So, what's representation got to do with it?

He wants to earn money in New York (as they pay him in New York). New York wants to tax that money. The courts say New York has a right to tax income paid in New York. What's wrong with that?

Fairtax

[ScoLgo]

This is why the US of A needs the FairTax.

It would do away with all this income tax malarkey. At least at the federal level. Once that happens, it's a good bet that individual states would follow suit.

Re:Fairtax

[Monkelectric]

Every tax proposal I see somehow provides extreme benefit to the extremely wealthy. Is the fair tax any different?

Re:Fairtax

[GreyWolf3000]

Define what you mean by "extreme benefit."

The extremely wealthy are always going to be the best off at the end of the day. They are, after all, the richest. Any tax system that would break that would break the fundamental laws of the universe. You can't have the extremely wealthy wind up poor after taxes, and vice versa

As far as a tax code going out of its way to help the extremely wealthy, well, all I have to say is that our graduated income tax in the US pretty much proves that we don't have such a tax code.

Re:Fairtax

[ScoLgo]

Yes. It really benefits everyone. It's best to read it for yourself, but here are some quick points...

1. The tax burden shifts from those who work to those who spend. This would now include tourists, drug dealers, prostitutes, children, retirees, etc...

2. You are only taxed on new goods. Sell your used computer, car, house, whatever, without worying about taxes.

3. Every head of household will receive a monthly 'rebate' check from the federal government to reimburse the taxes collected on basic necessities. The closer to the poverty line you are, the larger the check. For instance, a family of four living at the poverty line would receive a monthly check of $497.00, (estimated at the time the Fairtax book was written).

4. Every pay period, you receive your gross wages. No Federal Withholding, no Social Security withholding, no Medicare withholding. Those taxes are paid from the sales tax.

5. No more April 15th. It's just another spring day.

6. Outsourcing of jobs and finances will stop as the flow is reversed to what will become the biggest and best tax haven in the world.

So... do the rich benefit? Sure they do. But not at the expense of the middle-class or the poor. Our current tax system is almost completely broken and needs a major overhaul.

Oh, and sooner is better than later.

Re:And his point is???

[grommit]

I think you're forgetting what those taxes are for. It may seem like it but taxes aren't there just to take your money. They're there for the government to provide services (such as roads, police, etc) for those people that make use of them, the residents. Hence, if you aren't a resident of a state and benefit in no way from the services that the government there provides, why should you be paying taxes to that government?

Re:And his point is???

[Laura_DilDio]

Screw that! Does he utilize any New York resources? Does he get the right to vote? No taxation without representation? Taxes paid while visiting in New York, or even taxes paid on wages earned while physically in New York are a little more understandable.

If they decide to tax this guy under the auspices that he is drawing an income on NY economy, then they should FULLY TAX all of the Indians who work at call centers for NY companies!

Re:And his point is???

[madajb]

That's the whole point of the Republic.
New York's laws stop at the New York border.
Tennesee's laws stop at the Tennessee border.

The fact that he did not "actually shift his carcass over the state line" (at least 75% of the time) is highly relevant.

-ajb

Re:So does this mean..

[magarity]

Parent is 'insightful', not funny.
 
Yes, they would, using the same logic as where the work is actually done whether it's from one state to another or one country to another. And to get you to pay it would probably be deducted up front and you'd have to file for a refund. Does India's equivalent of the IRS give a discount for income taxes paid to other countries like the US's IRS?

Re:Missing the point!

[bnenning]

100% of taxes levied against businesses are paid by their customers or the company will go out of business.

They can also be paid by employees via lower wages, or stockholders via lower profits. Your central point is correct though: every tax is ultimately paid by a human being, but that's not obvious to most people which is why politicians like to "tax" businesses.