Slashdot Mirror

← Back to Stories (view on slashdot.org)

Telecommuters May Owe Extra State Taxes

Posted by ScuttleMonkey on from the death-and-taxes dept.

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."

7 of 617 comments (clear)

  1. SSH? VNC? by Short+Circuit · · Score: 3, Interesting

    Don't tell me half the people here haven't used these tools...Work on a website in California? A chicago colo? Did you earn money for it?

    ...Do you owe taxes on it?

    --
    tasks(723) drafts(105) languages(484) examples(29106)
  2. Why not tax me for working out of another state? by ajdowntown · · Score: 3, Interesting

    This would be stupid. If this were true, then I would owe my left arm. Let me explain.

    I worked as a flight attendant. I was based out of a nearby state. And very often, I would be sent to other airports to work out of there. So, could I possibly owe taxes in every state I worked out of?

    I know this is telecommuting, but the idea is the same, I technically lived in one state and worked out of many others...

    Stupid...

  3. Ironically the Military is the Reverse by LexNaturalis · · Score: 4, Interesting

    If you're in the military you can choose your "state of residence" and that's the state that you actually pay taxes to, not the in the state that you work. Florida is a brilliant choice because there is no income tax. So even if you live in New York, you won't pay New York income taxes. I find it somewhat ironic that a telecommuter pays taxes in New York without actually living there whereas a Military officer would live there and not pay taxes.

    Caveat: This might have changed in the past 4 years, but I know in 2001, that's how it worked. The military has been, as of late, cracking down on people who claim non-tax states as their home while having no plans of ever actually living in that state or having any ties in that state.

    --
    Men occasionally stumble over the truth, but most of them pick themselves up and hurry off as if nothing ever happened.
    1. Re:Ironically the Military is the Reverse by HardCase · · Score: 3, Interesting

      Even more interesting, some states, including Idaho (my home state) do not tax income that is not made within the state. So, when I was stationed in Rhode Island and California, I did not pay income tax to either of those states. But since I did not make my money in Idaho, I didn't pay them, either.

      When I was in California between 1992 and 1996, the legislature passed a law defining what qualified a person as a resident of California. If I recall correctly, the criteria were any two of home ownership, driver's license and (I think) a certain time of continuous residence. The net result was that most military members would end up being California residents (according to California) and would have to pay income tax, even if their official state of residence was elsewhere (and where they were also paying income tax). The DoD pounced on that very quickly and it was successfully challenged in court.

      -h-

  4. Re:So does this mean.. by CGP314 · · Score: 4, Interesting

    Hell, I moved out of the US and trained as a teacher in England and now work at a school in London. Can anyone explain to me why I still have to pay income tax to the U.S. government when I don't use any of their services?


    -Colin

  5. Hmmm.... by porcupine8 · · Score: 3, Interesting
    My husband lived in NC for five years as a grad student, but his "legal residence" was in Colorado where his mom lives, for various reasons. He paid income tax both in NC and CO, even though he was only in CO once or twice a year to visit family - HOWEVER, both states let you deduct taxes paid to another state when you were figuring what you owed, so he didn't really wind up paying that much (if any) more than usual. (Aside from the fact that NC has a pretty high income tax.) I forget the exact way it works, but he definitely didn't have to pay full taxes to both states.

    Of course, if TN has no income tax, I guess there would be no credit for it on this guy's NY taxes. *shrug*

    --
    Warning: Apple/Nintendo fangirl. Likes her electronics cute & cuddly. May be rabid.
  6. Re:Fairtax by khallow · · Score: 3, Interesting
    A fairer scheme would be a tax on assets. After all, wealthy people and businesses are really the ones who benefit from government above all others. So they should be the ones who pay for government services that protect their wealth. And such a tax is not regressive unlike this sales tax (incidentally the so called "rebate check" is just a kludge that doesn't change the fundamentally regressive nature of the tax).

    Also, this aligns government with the preservation and increase of wealth in its citizens. After all, under your current scheme, government has a strong incentive to increase spending on new goods in order to increase tax revenue. OTOH, if they can only tax assets, then they have a strong incentive to increase the value of assets in order to increase revenue.

    This scheme also drives up the cost of goods and services and makes the cost of taxation less transparent to the end user. That adds economic inefficiency to the system and hides important information from the citizen (namely, how much of your money went to government?).