Telecommute Tax Relief Gathers Steam

coondoggie writes to tell us NetworkWorld is reporting that backers of new telecommuter friendly tax legislation have high hopes that this might be the year that it sticks. From the article: " If passed, the Telecommuter Tax Fairness Act would prevent states from taxing income that nonresidents who telecommute to an in-state employer earn while working from home. The legislation is aimed in particular at New York, which is legendary for its stance on nonresident teleworkers. It requires those who sometimes work in the office of their New York employers to pay state taxes -- not only on the income they earn while physically in New York, but also on the income they earn at home. This often results in a double tax when the telecommuter's home state expects tax on the income the telecommuter earns at home."

Comments

It'll never pass

[Jason1729]

This legislation is aimed to help average workers. There's little benefit for big business or legislators. It will never pass.

Re:It'll never pass

[Jamil Karim]

Never underestimate the power of an election year. It just might pass.

Re:It'll never pass

[Elemenope]

WTF state are you in? And why haven't you sued them yet for equity? And why aren't there bloody mobs with bloody pitchforks storming the capitol? Though I believe you if you say so, I find this almost hard to believe. Boiling a frog with slowly rising taxes is one thing. Stabbing them in the eye with a skewer is something else entirely.

not using infrastructure

[P3NIS_CLEAVER]

This is only fair, if you aren't using the infrastructure of the city you shouldn't have to pay for it.

Re:not using infrastructure

[Rob the Bold]

Second, it doesn't follow that just because you're working outside of the state that you aren't making use of the state's resources. Ever wonder why so many businesses are located in Manhatten? Its not because of the low-low prices of real-estate.

I may have eaten a Georgia peach, a Florida Tangerine, a Texas Grapefruit and a California orange today. Not to mention the Oklahoma oil and a car from Michigan. So I guess that one could argue that I'm using those states' resources, too, but please don't. I really don't want to pay state income tax to 48 states I don't work in whose "resources" I indirectly use.

Heh

[SlashChick]

From the article: "The U.S. Office of Personnel Management encouraged federal agencies to more aggressively promote fuel-consuming options such as teleworking in a September memo."

Darn that Bush. I always knew he was conspiring with the oil companies! ;)

Re:Why Does Anyone Base Their Company In New York?

[dkoulomzin]

Well the parent is TOTAL flame bait, but it does also need to be answered. So here's my non-flame reply.

Businesses choose NYC for lots of reasons, some of which are:
1) Lots of other businesses are there. That makes doing business more efficient, since most of it is done face to face.
2) NYSE, and other cornerstones of the financial world are located in NYC
3) Vast numbers of people to employ
4) Several world-class Universities are located in NYC or its environs, so there is no shortage of brain-power

All of these things in one way or another rely on taxes, be it for transportation or other infrastructure.

And btw, if you are employed by a company in NYC, you are taking advantage of NYC, even if you never go there. The fact is without NYC, that particular job wouldn't exist.

No, I'm not a New Yorker. I live in Boston.

Re:Free Lunch

[Kadin2048]

How should NYC pay for the costs of legislating, policing, and judging the protections of the workers while they're telecommunting to NYC businesses? Or any of the other municipal/state costs that keep NYC such a great place to work, even virtually?

I can't tell whether or not you're joking.

I'm sorry, but if I'm telecommuting into an "office" in NYC, I'm using zero services from the City of New York, that are not already being paid for by my employer there.

If I keel over at my desk onto my "virtual office," NYC isn't going to pay for the ambulance to come pick me up. When I flush the toilet, it's not NYC's sewage system that the waste is going to go into. The only reason I'm commuting to NYC at all is because there are (presumably) other people there that I want to communicate with -- after all, "telecommuting" is just a fancy word for communicate -- and those people pay taxes. So NYC is still getting their cut for the value they're providing.

This whole argument is ridiculous. What happens if a person in New York and a person in Des Moines have a discussion over a forum or Wiki, that's on a server in a colo in San Francisco. Should both people pay tax in SF? They're "working" there (they may not know it), aren't they? Oh wait, SF has already been paid -- by the company that runs the colo facility. Likewise, if I "telecommute" into NYC, whoever I'm commuting in to see is paying taxes.

New York City isn't doing anything to make itself a "great place to work virtually," they just happen to have a lot of people living there. Those people live there and pay taxes, but there's no reason why people not physically residing there should.

Your argument fails to make any sense.

In my mind, the problem here is why companies that have telecommuting employees insist on keeping them based, on paper, in NYC. If the guy works form his house in Jersey, put that down as his work location. If he works from the North Pole, put that down on his W-2. I've done remote-work jobs, and I've never used the location I'm calling-in to as my work location: I use whatever piece of ground I'm sitting on while I'm doing the work.

Computer do a lot of things, but they do not allow you to physically be in two places at the same time. All of this "tele-work" stuff just confuses the issue, which is inherently just a person sitting somewhere, in front of a computer and a telephone, talking to some other people, in a different place. There's no reason why this should be difficult to figure out.

There's a better way.

[jcr]

Once again, this is one of many obnoxious pitfalls of income taxes. Support the Fair Tax, both at the federal and state levels.

-jcr