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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."
This legislation is aimed to help average workers. There's little benefit for big business or legislators. It will never pass.
This is only fair, if you aren't using the infrastructure of the city you shouldn't have to pay for it.
Please sign petition to restore sanity to our banking system!!!
http://financialpetition.org/
Odds are they aren't going to get that around city taxes for telecommuters, such as in Yonkers and Manhattan, but could be a good deal for the state taxation purposes. Although I'd hate to see spammers taking advantage of this somehow.
Walk with Music;
What if my local employer opens a branch office in NYC. Do I owe NY taxes then, even though I don't work there? What if I do some remote administration for that office? What if they're connected via VPN and I occasionally browse fileservers on their LAN? At what point do I cross the line where they mistakenly think I should pay them something?
I'm glad to see this legislation go through, even though I think it's incredibly stupid that there's a need for it.
Dewey, what part of this looks like authorities should be involved?
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!
Simpli - Your source for San Jose dedicated servers and colocation!
People being double charged for state taxes is a larger problem then just telecommuters. Many people who live close to a state line and work in another state end up double paying. Sometimes there are forms which can be used to avoid this but they are not widely publicised.
Hmm, a piece of legislation that could improve the lives of citizens? I wonder what sort of soul-sucking privacy-invading large-state-entitlement riders will be attached to the final bill.
NY has always been a problem with taxing non-residents... whether they telecommute or not.
I used to work in NYC while living in NJ. Even with going in to the office on a daily basis, NY wanted me to report all income (interest, dividends, side job not in NY, etc), then calculate the tax on that, using the non-resident scale, then multiply it by the percentage of my total income earned in NY. Net result is that I had to pay more in taxes instead of paying based solely on money earned in NY.
OCO is Loco
I live in NJ, work in NY. NJ only taxes me on income not subject to tax in NY -- not income not earned in NY. Not sure about how other states deal with state taxes paid to another state.
Sucks anyway for me, since NY state tax is approximately 2.5-3 times the NJ tax, and I derive very little benefit from the NY taxes I pay. But, for telecommuters who sometimes have to work in NY -- nice deal. Makes me want to telecommute and pay the NJ tax rate when I'm working from home.
A scenario though -- if an employer has a telecommuting employee in another state, do they need to pay employment taxes in that state? My company has satellite offices in other states, and legally it's a bit of a pain. Would a company have to file also as a NJ employer if their telecommuting employees were treated as working in NJ while telecommuting?
"Trolls they were, but filled with the evil will of their master: a fell race..." -- J.R.R. Tolkien on Olog-hai
This often results in a double tax when the telecommuter's home state expects tax on the income the telecommuter earns at home.
I am pretty sure that Connecticut is the only state that doesn't have reciprocity for state taxes. IOW, in most states, you can deduct state taxes paid to another state so you don't get double whacked. This is useful for people who live on state borders. Of course, you accountant makes out better.check with your accountant.
The people who really get screwed are those that don't pay any state tax.
Although I'd hate to see spammers taking advantage of this somehow.
I doubt very much that spammers pay taxes anyway. Unless you count the bribes they're probably paying to the Russian mob as "taxes."
"Ladies and gentlemen, my killbot features Lotus Notes and a machine gun. It is the finest available."
A couple years ago I needed to file taxes in 3 states and the taxes came out effectively the same as if I paid a single state at the highest rate (which was NY).
Err.. I'm having trouble.. Are you being sarcastic in your first paragraph?
Stay in New York, New Yahkuhs.
It probably won't surprise you in the least when I say.... Up yours!
www.wavefront-av.com
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.
Thou shalt not begin a subject line or post with the word "Umm".
Well, NY has long had the right to tax nonresident employees whose income comes from NY services. That's been an decades long debate for out-of-state commuters as well as the newer debate amongst telecommuters.
That's a penalty to an employer and employee who sets up shop in NYC - just deal with it. Or leave.
So, if the employer really liked you and wanted to support telecommuting, they'd just setup a satellite office in NJ or Connecticut and host a few servers there so that could be your main location. So blame your damned employer because they could easily fix the problem if they cared enough about you to actually do something. But, no, your bosses want that prestigious NYC address and don't want to help the little guy.
PS I recognize the problems with telecommuting or even commuting double taxation. But local/state tax laws are deeply mired in local politics and if business just started setting up shop (or just satellite offices) in places with more commuter/tele-commuter friendly locations, the problem solves itself.
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.
"Ladies and gentlemen, my killbot features Lotus Notes and a machine gun. It is the finest available."
How should NYC pay for the costs of legislating, policing, and judging the protections of the workers while they're telecommunting to NYC businesses?
Ever been mugged on your vpn?
"We returned the General to El Salvador, or maybe Guatemala, it's difficult to tell from 10,000 feet"
If you live e.g. in New Jersey, how can New York expect you to pay taxes, since you don't vote for anyone in New York?
Several years ago, the city of Miami decided to raise taxes on parking so it could extort money from those workers who commuted from Broward county and otherwise were not paying for services in Miami-Dade. Someone sued the city for taxation without representation, since he lived in Broward and so could not participate in Miami-Dade elections. I believe the state supreme court agreed with him, and the city had to make other plans to get the revenue for the sports venue they were planning.
No.
Here's a good test for sarcasm: take the communication at face value. Is a response ridiculous? If not, it's safe to assume you're not dealing with sarcasm.
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If passed, the Telecommuter Tax Fairness Act would prevent states from taxing income earned by nonresidents who telecommute to an in-state employer while working from home.
Why not just go all the way and not tax income?
Support the FairTax
State tax rates are progressive. What that means is that someone earning $100k pays more than twice what someone earning $50k would pay. If you split your $100k paycheck between 2 states with identical tax rates, you shouldn't end up paying any less or more than someone who earned the entire income in one of those 2 state. Other states tax laws work the same way too - this isn't just NY.
Mmmm.. Donuts
As a telecommuter, you're not consuming any services from the other state.
If they get really sticky about it, just describe your home as a branch office (in which you are based) with all your office space and equipment being leased by you to the company in question.
well, more or less, try http://www.fairtax.org/ for a different method of taxation that would not care what state you earned the money in or from.
Support NYCountryLawyer RIAA vs People
How can you quote the specific example of the NYC justice system protecting your job and your employer, then ignore it in your response? Sounds like you're overpaying for your Kansas schools. I don't think you need any other references to the Dark Ages beyond what we've already mentioned here.
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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.
The problem is generally when people actually do work in the office from time to time. I work for a company in California during the summer, and when I'm at school in New York during the school year I sometimes telecommute in. It makes complete sense for the company to declare my office as being in California, but currently both California and New York can claim that I owe income tax in their state for the work I'm doing while telecommuting.
Here's an interesting tidbit about New Jersey and New York income taxes. Last year, my fiance worked in New Jersey for 2 months, January and February. She then moved to Albany where she worked the remainder of the year for a different employer. She cut all ties to New Jersey once she moved, so none of her work was done there. Last month when she filed her income taxes, lo and behold New Jersey taxes people for their entire annual income, regardless of whether you earned it all in New Jersey or not. She basically had to pay income tax twice. New York, on the other hand, only taxed her for her New York income. Personally, I think that the New Jersey tax is worse than the New York telecommuter since she didn't feasibly benefit New Jersey's economy in any way after she moved. You could possibly make an argument that a telecommuter to a New York location does effect the economy there because you're conducting business there.
If you're a stock trader who lives in Jersey (a few do), and you telecommute to your desk in Manhattan to make a trade on the NYSE, isn't that affecting New York's (and some could argue the global) economy?
When your NYC company's ISP gets DDoS'ed by an extortion racket, they call the NY Attorney General. Who pays for that?
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The taxes from the NYC-based ISP.
Dewey, what part of this looks like authorities should be involved?
Once again, this is one of many obnoxious pitfalls of income taxes. Support the Fair Tax, both at the federal and state levels.
-jcr
The only title of honor that a tyrant can grant is "Enemy of the State."
they call the NY Attorney General. Who pays for that?
Oh, I don't know, how about the company?
Since the NY AG would shrug and say "what can I do about that?", no one pays for it.
And in pretend-land, where law enforcement actually does something about computer crime, well, the ISP has employees in NY paying for it.
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.
SInce when has taxation been about fairness?
This is just one of many excellent reasons for locating a business in Nevada, Washington, Texas, or any other state without an income tax.
-jcr
The only title of honor that a tyrant can grant is "Enemy of the State."
NY has provided a whole slew of services to your business. Your business has chosen to be located in NY despite having the choice to move anyplace in the world. Therefore there must be something there that your business likes and since they seem to be thriving enough to hire you and let you work from a remote location they must be getting their money's worth.
In other words you might not have this job if your company wasn't located in NY.
evil is as evil does
So you're honest belief is that a person who lives in State A and works for a company in State B should actually pay double state taxes to both states? If they're a consultant who travels all over the country, do they have to pay full taxes in all 50 states?
As someone who lives in Chicago, telecommutes to support a development office in California, for a company headquartered in Texas, how many state's income taxes should I be paying?
(Actual answer: I pay Illinois income taxes.)
Sure Met Life is still domociled in NY; advantages as a NY Insurer, but a lot of the jobs were moved to NJ and elsewhere.
Not only that, the Met Life building will soon be converted into condominium apartments.
I don't read or respond to AC posts
So are you saying your wife's income was doubly taxed? Yes, that seems unjust, and I think we should seek to address that. I don't think more than one state should be entitled to taxing any given dollar you earn. However, I don't think your problem had anything to do with telecommuting (unless I missed something in your description). BTW, did you consider filing seperately? I bet that could have allowed your wife to pay CT taxes only/instead, if that better suited your desires. (And if you considered that, and chose not to file that way, then you hardly have a gripe.)
Thou shalt not begin a subject line or post with the word "Umm".
Many of the NYC services you think you "pay for" are actually paid for by NYC residents (trust me, this is not a small tax to pay, especially if you are an "unincorporated business"). You are paying New York State tax. So the roads, schools, and various city services, etc. are paid for by us (i.e. city residents). I really don't want to rant here, and I'm not a follower of the "red state welfare" crap, but NYC sends more tax money to NYS and the Fed than it ever sees back. There are all sorts of good reasons for this, but don't whine to us about taxes. We already pay more than our fair share.
Let's get drunk and delete production data!
So should New York also be able to tax out-of-state residents for making phone calls to NYC residents?
I'm not trying to be a smartass here, I'm really trying to understand your point. But I don't see how telecommuting is "using NYC's resources" any more so than any other phone call... and the receiving lines are paid for New York companies, and taxed by New York... what service am I using that isn't being paid for by the people on the receiving end?
I'm desperately trying to understand your point, and you seem to be claiming that the government granting tax breaks will somehow lead us to some sort of anarchic dark age. And if that's the case, then why don't the residents of NYC simply demand that New York NOT give tax breaks to companies?
Poorly constructed example. When the telecommuter's NYC company gets a new bill from their ISP raising rates on their VPN, the company calls the Consumer Affairs department, the cops, the Attorney General, or some other government office, or their lawyer does.
Remember, corporations don't pay as much taxes as they consume in services already. Especially in cities like NYC which have cut taxes and made deals, supposedly to keep companies from leaving for places like New Jersey which don't charge taxes - or offer services.
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I telecommute from suburban Philadelphia to ... well, thats a good question. My employer has an office in NYC that is home to about 6 people, but it also has an office in LA and Nashville, as well as London, Paris, Berlin and Tokyo. Even if I used my company's computing equipment (I don't), it would be hard to pin point exactly what is special about the NYC office other than its my nominal "designated office".
My home neighbourhood is the one that faces expenses from my presence here - theoretically I will drive to and from home more often given than I work at home, I will use more local services because I am at home etc.
But wait. If I commuted to work, I'd be driving those same roads every day whereas by telecommuting I drive them hardly ever. Moreoever, if I returned to my life as a stay-at-home parent, I'd be using local services even more (parks, libraries, stores and more), and paying nothing "extra" to do so. So who is winning and losing here? NYC incurs costs that are asymptotically zero from my designated office location being there. My home neighbourhood incurs costs that are either identical with or lower than the ones that would be involved in me not working at home. I pay state taxes anyway, and am glad to pay for the provision of state and local government services. I just can't see how my telecommuting has anything to do with my specific case. I live and work in Pennsylvania for a company with a world wide presence and an office in NYC. I pay taxes to Pennsylvania (gladly!) and that helps pay for the services I use, and would continue to use even if I were unemployed and paying no taxes.
What's the claim that NYC should collect taxes from me?
I already pointed out that the company underpays taxes already. And that the same people push for reduced taxes on both corporations and individuals (but mainly corporations and the individuals who own them).
How can you miss that?
Those people are also responsible for more than their proportional share of action by government, especially legal action.
Maybe you think there's such a thing as a free lunch, like the people trying to drown government in a bathtub.
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I doubt this. Like other states, New Jersey has a part-time resident and non-resident tax form which stipulates that your wife is responsible for paying taxes only on income she earned while in New Jersey (see page 7). If she lived in New York but continued working in New Jersey, then the income is split between New York and New Jersey. But that's not what you said.
Until Elliot Spitzer showed up, its hard to argue that NY or NYC offered services above or beyond those present in Jersey City on the other side of the Hudson. Telecommuting isn't suitable for positions where people make things using industrial infrastructure as offered by major cities and ports. Telecommuters use networking facilities that were (unfortunately, from many perspectives) built and maintained by private corporations (admittedly under city-granted monopoly conditions). Its hard to argue that a telecommuter who works from her home on 5th Avenue in NYC is using any more or less city/state/federal services for her work than one who works across the water in Hoboken.
Are you sure about that? I have helped a coworker who moved to/from NJ/NYC a couple years and had to deal with part-year resident forms on both sides. If you make 20K while living in NJ and 40K after moving to NY (and from a NY source), only 20K is taxable in NJ. Part-year resident tax forms for NJ are much less tedious than NYS/NYC PY resident tax forms (where you have to do a column for what's on your fed forms, another for what portion was NY state, etc).
From NJ 051040i.pdf p17
Filing Requirements. Any person who became a resident of this State or moved out of this State during the year is subject to New Jersey income tax for that portion of the income received while a resident of New Jersey. Part-year residents must file a resident return and prorate all exemptions, deductions, and credits, as well as the pension and other retirement income exclusions, to reflect the period covered by the return. A person who receives income from a New Jersey source while a nonresident must file a New Jersey nonresident return.
In NYC, where we know all about reality, the inadequacies of telecom crime law enforcement come mainly from underfunding professional training and staffing. Though we do spend an awful lot of money on what they do cover.
Here in realitytown, we know that the extra demand on the ISP placed by its customers makes extra work for the legal services. And that the ISP is even more likely to have telecommuters.
Which part of pretend-land do you live in? The part where there's always someone else to pay the tab, so the bill never lands anywhere?
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Are you saying big business wants to pay a 50% premium on consulting services?
===== Murphy's Law is recursive. =====
You mean to tell me that where you live, if you change the price you charge for your services then you can expect to hear from Consumer Affairs, the cops, the AG, and other government offices?
I think I've identified the disconnect between our logic: You've been living around lawyers and politicians far too long for your own good.
Dewey, what part of this looks like authorities should be involved?
How is someone working in, say, Arizona taking advantage of legislating, policing, and judging? Isn't that what business/sales/property taxes (ie activites/items that physically take place in NY) are for? If you are, as another poster talked about, referring to various tax incentives that the city/state of NY gave to the businesses... Well, I gotta say, that's the city/state's fault for being that stupid, to give tax breaks/exemptions to businesses, without having teeth in them about worker status.
To take this to the logical (and in my mind, absurd) conclusion... A business has an office in NY. That business also has offices in each of the other 50 states. Say you work for that business, doing something that requires you to visit every state's office once per year. If everyone were like NY, you'd owe full income tax in every state. Some states, of course, do not have state income tax, so you're not looking at all 50 states.. But, let's say a good 35 of them, for the sake of argument, and they have an average rate of 4%.
Wow... I'd hate to have to pay 4% of my income to 35 states.. Heck, I'm not even quite sure how I'd manage it. This is ok, right? Because each state has police that they need to keep up, etc., all of which you are taking full advantage of, by way of being in that state, on business, for one day of the year. This is disregarding any other consideration that could be brought up (interstate commerce, anyone?).
I'm sure this argument won't make a dent, but hey...
And if the company is "underpaying" taxes -- illegally -- then by all means, the company should be taken to task by the state. If the company is "underpaying" taxes, as defined by "paying less in taxes than they consume in services," then the government of New York should man up and go ahead and raise taxes & revoke the tax breaks it's given to companies. If NYS / NYC is actually providing valuable services, the company will continue to locate there, and pay the taxes... if the perceived value of the services isn't worth it, then perhaps NYC will end up losing a lot of businesses. Either way, I fail to see how it's the *telecommuters* job to put to rights the disparity you see between production and consumption.
Its hard to argue that a telecommuter who works from her home on 5th Avenue in NYC is using any more or less city/state/federal services for her work than one who works across the water in Hoboken.
It's pretty eaasy, actually - the telecommuter is using network resources, which are private, and server resources, which are in real estate taxed by the city. They aren't using the roads, trains, or utilities.
"We returned the General to El Salvador, or maybe Guatemala, it's difficult to tell from 10,000 feet"
If only.
<xml><I><am><so><damn>Web 2.0</damn></so></am></I></xml>
Taxation without representation happens all the time. That boat set sail a long, long time ago.
GCHQ Quantum Insert installed. If only our tongues were made of glass, how much more careful we would be when we speak
The power to tax is the power to destroy.
It's an issue for the courts.
Skot Nelson music is my saviour / i was maimed by rock and roll
I think that any district that you pay taxes in you should also be allowed to vote in district wide elections (State, County, City). You should have a say in how things are being run if you are paying for it's support.
Shop smart, Shop S-Mart.
If a program is so important and far reaching that it really and sincerely affects people outside the state, federalize it and I'll gladly pay my fair share. Until then, I'd rather not be paying for New York roads, Virginia schools, and upkeep on state courthouses in Illinois.
An interesting anagram of "BANACH TARSKI" is "BANACH TARSKI BANACH TARSKI"
At this very moment, my butt is parked in an Michigan office with a tie around my neck doing work I could do at home in my bunny slippers.
You can post on Slashdot in your bunny slippers? Who knew!
God invented whiskey so the Irish would not rule the world.
What's the basis for the "so" with which you start off your question? I asked how the NYC services consumed by the telecommuter should be paid. The story summary, and framers of the telecommuter tax issue present an all-or-nothing false choice.
I don't think that the telecommuter should pay for all the redundant services delivered in multiple places. In fact, it's long been clear to me that the most appropriate tax is sales tax, with true necessities excluded - and labor included (instead of income tax).
In telecommuting, the labor takes place simultaneously in multiple locations, which split the tax on its wage price proportionately. If Chicago had a 10% sales tax and NYC had a 15% sales tax, and you charged your NYC employer $200, you'd owe Chicago 10% of $100 = $10 and NYC 15% of $100 = $15, so you'd probably tack $25 onto the $200 price.
It's a lot easier, cheaper and more likely to collect sales taxes from the fewer vendors than consumers, using the more frequent government controls on vendors for enforcement. Which means lower cost of collection and higher collections. All based on a system that costs people proportionate to their benefit from it, while reserving subsidy for necessities for the poor without the overhead of cycling the money through those less competent people.
If our $12T+ GDP paid 21% sales tax instead of income tax, we'd have the $2.5T Federal budget without debt - and a surplus. Include the other government income, and total Federal, state and local sales taxes would account for expenses, before any debt or even a 25% sales tax, not even considering the savings of such a simpler system. And it would make tax reporting much cheaper and easier, not to mention fairer and less invasive.
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I have to wonder, though... what does NY state income tax pay for, and can you really justify the conclusion that people who telecommute to New York benefit from it an any material way (or, at least, any more than a wealthy out of state resident who makes most of his income buying and selling assets on the NYSE)?
An interesting anagram of "BANACH TARSKI" is "BANACH TARSKI BANACH TARSKI"
Are you allowed to vote in the jurisdiction that's attempting to tax you?
From a moral stance, you're hardly obligated to pay taxes to a government that doesn't allow you to elect representatives. Especially in America.
(Notice I didn't say "... to a government that doesn't represent you.")
If "the company underpays taxes already", then the appropriate solution is to correct the company's tax rate, not to overtax anyone who happens to telecommute to the company.
Consider: If I telecommute to a NY company 10% of the time, then, even if your suggestion that I am using NY services is accepted at face value, I am only using them during 10% of my working hours. There is no justification for requiring me to pay NY taxes on the 90% of my working hours which are spent working with non-NY companies.
Consider further: While telecommuting to the NY company for that 10% of my working hours, I am using NY services at a far lower level than if I were a worker in NY - I'm not using the roads, fire department, police protection, etc. - and the services I am using are generally among the least expensive of the services provided by NY, therefore, telecommuting to NY for 10% of my hours costs NY far less than if I physically commuted there for those hours. It follows that, even on that 10% of my hours, I should be paying taxes at a far lower rate if I am telecommuting. Perhaps even at a rate so low that the cost of calculating and collecting the fair tax would be greater than the amount of that tax, in which case the tax should just be dropped to save money (both for me and for NY).
Unless, of course, you think NY should get a free lunch by charging out-of-state workers for services they're not in a position to make use of...
The telecommuting telecommunications isn't using NYC's resources much, though in fact NYC telecom taxes do pay for that - in a vastly complex, usually unfair system that doesn't pay its own way.
The NYC company consuming NYC services to employ the telecommuter has to be paid by taxes. And the NYC corporations don't pay enough to support that. I already specified just one kind of NYC service, legal/justice, consumed by telecommuters, but every respondent has ignored it.
NYC residents do demand NYC not give tax breaks to companies. But corporations have much more clout than humans, in NYC as elsewhere, so corporate demands trump human ones, in combination with other issues politicians use to cover the corporate welfare.
FWIW, one reason Giuliani was so hated by most New Yorkers by the end of his term as mayor was because he dropped the commuter tax on the physical commuters who depend on NYC services for their way of life. Not just the services keeping their office working. But also as a sink for poor people who can't afford the cost of living in the commuters' hometowns, who keep those hometown service demands low by living in NYC. Where it's also cheaper to service them, in our economy of scale.
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According to your "I called it first" theory of jurisprudence, London should be able to tax New Yorkers and all Vancouverites should be tithed by the Centre of the Know Universe -- Toronto.
Seems unlikely to fly to me.
Skot Nelson music is my saviour / i was maimed by rock and roll
If NY is going to charge me taxes for telecommuting there, they had better let me VOTE there, too!
If one dime of my income tax money goes to NY, and they don't let me vote for the representatives that decide what those taxes are, I think its time to make some salty tea in NY.
A slashdotter who didn't build his own computer is like a Jedi who didn't build his own lightsaber.
Excuse me? Around 50% of the taxes that a NY, but not NYC, resident pays to the State *GOES TO NYC*. You seem to have this equation a bit backwards.
Now, of course you don't see anything back from the Fed. Their current purpose is to consume as much as possible for as little work as possible. You pay much more than double your State taxes to the Feds. In that regard, of *course* you pay a lot more than you get; you pay most of that to the Fed.
NYC uses the tax money that the employer pays in order to cover those services. The employee that is working in another state should pay that state the income. If you live in NY, and earn income in NJ, you pay NJ. Well, if I live in NJ, and telecommute to NY, I'm *working* in NJ, and pay NJ.
Put another way, when you drive from NJ to, say, Maryland... do you pay Delaware and Maryland taxes for the trip? You are gaining benefit from their roads, fire services, police, court systems, public works departments, etc. Of course you don't, because you don't earn income in those states, so they don't get to tax it. The gas stations, restaurants, hotels, etc, in those states pay taxes based on what you've paid to those businesses. That covers the government costs.
"I asked how the NYC services consumed by the telecommuter should be paid."
Who said the services should be paid by the consumer specifically? I'd love that to be the case, because then I wouldn't have to pay for all the crap of which I don't take advantage or support all the free loaders.
The real state of affairs does not equate all whom consume pay for the services consumed, not by a long shot. So why pick on telecommuters?
Anything is possible given time and money.
that it takes an act of congress to get a fair tax? Well, here again, the employees need to discuss what they net, and the tax should be declared and paid by the business as a condition of their liscense or corporate charter. And the employee should need to confirm or deny only if the company gets audited. And even then, the signed check and other receipts should be all that is necessary to confirm who was paid what. Remember, it's the Internal Revenue Service. They are supposed to serve us, not the other way around.
What?
Are you saying big business wants to pay a 50% premium on consulting services?
In many cases they do. I wish I knew the reason.
I didn't say you should pay the same taxes to NYC as if you physically commuted. And I didn't say that your company's distributed offices made taxing it to pay the cost of servicing it easy. But there is of course an appropriate solution. Not necessarily analyzable or presentable in a couple of Slashdot posts by me, but there's nothing paradoxical about the situation - except when one consumes services when telecommuting without paying for them.
I've posted elsewhere about the superiority of a sales tax system. It also addresses your concerns. Sales tax you paid on your rent or purchase of your home would pay for local services, as well as sales tax on local purchases you consume. Sales tax you collected on your labor would be split between your physical location (home) and where the work was consumed. Your example calls for a complex split on the consumption side, but that's a cost of complexity like other costs incurred by the complex organization. Not paying for services that enable you to sell your work there prohibits offering them - an untenable setup that would default to NYC residents paying to subsidize your work.
Just because you can't see the services supporting the receiving end of your product, doesn't mean they don't exist, or don't get paid for. If corporations paid taxes proportionate to their cost, or benefit, maybe you and your corporation would pay only your respective taxes. But they don't, so you have to.
Just moving you out of the corporation's service area doesn't make those costs go away. But, as you point out, they can be lower. So that tax should be different. And the total costs should reduce, reducing the taxes.
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Crime, you say? Take a look at the comparative positions of NY metro areas (more than just NYC) vs. FL metro areas with regard to crime.
Let's get drunk and delete production data!
... some people will never learn the difference between effect and affect:
"The issue effects not only employees but also employers."
And this, from a senior editor no less! Tsk tsk...
You're kidding about the equality of NYC government services to Jersey City government services, right? After all, your last sentence exactly supports the reasons for charging the Hoboken telecommuter taxes, just like the 5th Ave telecommuter. Except the part where the interstate commerce and telecom protection costs more in crossing the river.
Just for starters, Jersey City is mostly ghetto, NYC is only slightly ghetto. Jersey City public transit is subsidized more by NY than by NJ. The list is endless. And though Spitzer is doing a good job, he certainly didn't suddenly lift NY service delivery above that of Jersey City, which has been the pits for at least half a century, and never compared to NYC.
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Well if its one thing the US needs, its more tax breaks. Just run up the deficit some more. Its free money. Its not at all like mortgaging your future or anything.
Enjoy your cheap Chinese goods while you still can, they won't be cheap for long.
I don't know if it's still true, but at one time, all the franchises had special menus for NYC with higher prices. Between rents, unions and taxes, the cost of doing business there were so high they couldn't do otherwise and make a profit. Not only that, but during and after the time I heard about that (from an accountant who had clients with multiple franchises) I was seeing documentaries about how parts of the NYC infrastructure were falling apart and nobody was doing anything about it. Things like bridge abutments crumbling from salt air, streets that hadn't been resurfaced in decades, shutoff valves in the water system that hadn't been tested in so long they were almost certainly frozen and so on. If I weren't such a cynic, I'd wonder how all that tax money was being spent.
Good, inexpensive web hosting
Where do you get this info? Yes, assuming half of the tax paid to NYS goes to NYC, this means that half of the NYS taxes paid by NYC residents goes non-NYC parts of NYS. With NYC being a larger tax base, NYC is on the short end of the stick
If 50% of all NYS taxes collected goes to NYC, NYC loses out because it accounts for >50% of the NYS tax collected
None of the services you mention are being consumed by the telecommuter. They're being consumed by the telecommuter's parent corporation, and should be paid out of that company's taxes (real estate, corporate income, capital gains, etc.).
It seems like what you're really saying is that corporations pay too little taxes: that's a valid concern, but it's separate from where their employees should be paying taxes. All those 'protecting the business climate' types of services should be borne by the corporation, and not dependent on the tax revenues of its employees, who really don't get much of a say in where the company is located.
I think you're vastly overstating the resources being consumed by somebody who is just calling in and remotely working for a corporation. The great majority of tax revenues on state and local levels are spent on things like transportation infrastructure, education, public works, etc. None of those things are being used by the remote employee. They may have contributed to bringing the parent corporation to that area, but that doesn't mean the employees should have to bear the cost: the company should, if they want to be located in a particularly expensive area (i.e. Manhattan).
"Ladies and gentlemen, my killbot features Lotus Notes and a machine gun. It is the finest available."
The idea is this:
.
.
The people of a nation collectively put together a pile of money in order to do useful things which everybody agrees they need. Right? Building roads and water supply systems, police agencies, hospitals etc.
But then. .
Who gets elected? Why, the people who are cut-throat and unfair in their methods. The ones who lie the best. --The ones who are drawn to power!
Why do they win? Because they use all the normal tools to get elected which good people have, PLUS they also use lies and underhanded manipulations. They win over good-hearted people because good-hearted people limit themselves to only using above-board tactics. And so, with limited tool-boxes, the good guys tend to lose more often than the criminals, who arm themselves, not just with above-board tactics like posters and election promises, but also with wonky voting machines and hate-based propaganda about how they will punish, 'welfare moms'. (Which make up a microscopic fraction of the public spending in even the most socialist of nations). But Hate and Dark Side emotions are much easier to kindle in a voting public than rational thought. And anybody who is above hate will lose their vote anyway to a fixed voting machine. And if that doesn't work, the state-owned media will just lie about who won. Or they'll just kill the honest politicians in plane crashes. One way or another, the Dark Side wins time and again. The good guys don't stand a chance once the bad guys get in and own the game board!
So these greedy, morally bankrupt politicians and their industry-owning friends realize, "Hey! Check it out. With my brother-in-law in office, I can get all kinds of policies passed which entitle me to a big slice of that nice juicy public cash pie without my actually having to earn it! People are plenty stupid, they'll believe any old lie, and we just have to organize it so that the state has all the guns. Keen! I can live high and never have to put in a real day of work ever again!"
And so it goes.
But. .
Because the greedy are greedy, they never feel like they have enough, and so the taxes rise, and the hidden taxes, (such as oil and energy), rise. And they cut away at the actual things a nation would probably want, like education funds and medical care. (You just trick the people through massive propaganda into believing that such things are bad for them. Sounds insane, but look around you.) With social spending cut, there's more money for the greedy politician and his friends and family.
But somehow. . , even with the billions flowing into the politician's family coffers, it's still not enough. This is because greed is NOT good. Greed is a disease! --And so the greedy looked around to find new ways to make even more money, and they realized that it was advantageous to them if the other nations of the world never achieved first-world status. Cheep, 1-cent an hour labor is a great way to get and stay rich! --So they use the secret-service agencies to subvert and de-stabalize nations on the brink of industrial success. This is done through funding coups of legitimate foriegn leaders and channeling heavy narcotics trade through those nations. Drug corridor nations quickly become user nations. (The Opium War in China was a good example of how drugs were used to destroy a nation's growth momentum.)
But high taxes and hidden taxes and entire slave nations are still are not enough for the greedy. Nope. --So they start wars, filling the people with fear, all to ensure that the people are too afraid to think rationally and otherwise recognize that they are being abused by their own government. --Plus, the weapons sales are another excellent way to cut into that nice juicy public cash pie!
So what percentage of your tax dollars do you think are being spent on things the collective public actually wanted in the first place? 30 percent? 20 percent? I'm willing to bet it's even less.
So what do you do about it?
Well, you can't
I think you are wrong. Care to support your claims with some evidence?
Let's get drunk and delete production data!
Are you new to consulting?
Clients like to have you there, and they perfer to pay a premium.
When I was consulting, at one point I doubled my rate, and got three times the number of clients. I double my rates becuase people kept asking me how much more to be on site 100%. Not wanting to be in site I just doubled my rate.
The funny thing is no client was further then a 30 minute drive away!
The Kruger Dunning explains most post on
An Arizonan working for an NYC company makes that company bigger, requiring more legal infrastructure in NYC. Corporations don't pay enough taxes for governments to service them already, and raising those taxes would be harder than even taxing telecommuters. Unfortunately, many of the corporate tax breaks are produced by unaccountable politicians, like Giuliani after he was no longer eligible for reelection.
Distributed consumers of telecommuter labor make the tax/service problem more complex, naturally - just like they make everything more complex with their increased complexity. But corporations are incorporated in a single state, with offices in a single location. Telecommuter taxes are far from the first attempt to exploit corporate virtuality to evade taxes or other liabilities. Taxing telecommuters is just another example.
FWIW, I never said telecommuters would pay the full income tax, or the same taxes, as local workers. Taxing telecommuters appropriately doesn't mean picking either full or no taxes. Appropriately taxed to their service costs, telecommuters offer many benefits to their remote locations. Including flexibility in face of disasters and regional economics, as well as offering a much larger pool of labor in which telecommuters compete for work. As well as road/bridge/tunnel/transit maintenance and capacity, which are usually net losses.
FWIW, I'm continuing the debate regardless of whether you learn anything from it. I'm taking your side seriously, to ensure that my vision accommodates both the economic realities and popular (if even weak) criticisms and concerns. You're the one who's suggested the debate isn't serious in every one of your posts, which certainly doesn't encourage any hope that you wwill learn anything from it.
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Yes you did. And now you're ignoring another fact I mentioned, that corporations don't pay enough taxes for their required services already - where they consume more than just the electricity for their remote access machine.
You've burned two chances to say something serious. Why should I continue to reply?
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What would law enforcement do if you called them regarding someone carrying out a cyberattack on you? I think we all know the answer. Get back to me when the government does something for telecommuters worth paying for.
Look, I'm talking about the obvious case where raising prices violates the law, as I mentioned necessitating legal/justice service. Like raising them despite contractual obligation, or beyond monopoly tariffs. I think you're projecting your lawyer fixation on me, and I'm not going to bother grinding out posts to meet your parsing requirements.
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"If the company is "underpaying" taxes, as defined by "paying less in taxes than they consume in services," then the government of New York should man up and go ahead and raise taxes & revoke the tax breaks it's given to companies."
Corporations also evade taxes, but mostly they do it legally. Transforming our political system is even less likely than fixing our tax system. Until we replace either or both, like with the sales tax system I favor, we have to patch it. Patching it merely to drop telecommuters from paying for services they continue to consume, like the protections of their paychecks from deadbeat employers, just kills the protector.
Every reply post disagreeing with my post has ignored the actual reality of taxes, service cost and politics. It's like people think our society is some kind of ideal libertarian machine that just has a little bit of inefficient sand in its gears, that cleared away will just return fairness to humans. Maybe more people need to actually work physically in New York City, where reality is unavoidable.
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Resident aliens have to pay tax, but can't vote. They can even get drafted to fight for the country that doesn't give them the vote!
Democracy my butt!
K.
Yeah, get corporations to give up their welfare. No chance. There is a chance to keep telecommuters paying for service demands they generate, by stopping or fixing the bills we're discussing.
As I've posted again and again in this thread, I'm not saying telecommuters have to pay the same amount of taxes as local workers - just not zero.
If you want to talk about NY getting a free lunch, I suggest you look at how much we pay to subsidize the rest of the country, especially places that offer less services. Which welfare state do you live in?
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Corporations don't pay their fair share, and won't be giving up the welfare their power grabs them anytime soon. We're talking about a new law that would also hand free services to telecommuters, too. And that's unacceptable, because it's economically impossible.
How about someone actually answers my question in this thread, rather than the dozens of misdirections I've charitably warded off? You've come closest, so I'll requery you.
How should those services telecommuters consume be paid?
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As I keep repeating in this thread, corporations don't pay taxes sufficient to cover their costs.
Delaware and Maryland don't charge tolls on those roads, because their budget model doesn't require it due to alternatives. But NJ does charge tolls on its roads.
The income tax is a terrible way to tax people. I prefer a sales tax, which is simpler, easier to control, and based on the benefit people derive from the system whose bills we're paying.
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Guess again. Not only does NYC spend a lot of money defending itself from "cybercrime", but its defense protects lots more than just our own companies, residents and tele/commuters. As usual, we're working hard to keep the whole country working.
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"except when one consumes services when telecommuting without paying for them."
Which services are these? GP mentions many services that certainly _aren't_ consumed, and yet it seems you haven't come up with a single specific example of services that _are_ consumed.
This whole taxation problem is one reason why it's great to be a contractor. As a contractor, my official place of business IS my home. If I'm working for a NY company, it doesn't matter. I'm a private company working in Washington, and a NY company is simply paying for my services. So NY can't collect a dime from the money they pay me.
can we at least all agree that the total tax liability of a telecommuter should not be double that of someone that works in an office? the total tax bill should be about the same as someone that isn't telecommuting. when you see it from that perspective and start to think about what proportion of that total would go to where they live and what proportion should go to where they work, the vanishingly small amount of services provided by the city that they're telecommuting into make the act of even paying that portion of their taxes in a separate filing a huge waste. if 99.9% of the services i receive are from my home city and .1% are from my work city, the overhead of actually paying/collecting/tracking/enforcing that .1% probably approaches the actual amount they're collecting.
That sounds like an reason to live there not have a business there. Having no income tax has little to do with having a good business climate.
;) Idaho sales tax form is 1/3 page....the Washington form is 4 pages...which one do you want to pay someone to fillout each month?? Not to mention WA snipes .5% off the top that you can't pass on directly for B&O tax .
:( Wouldn't be so bad if there weren't exemptions for most big businesses,etc.
If i had a choice(not my company..yet) i would move the comapny next door to idaho despite the tax. The business tax forms rock
How about a litter tax for the state of WA.....that doesn't apply to McDonalds!?! WTF, none of the litter here comes from fast food joints ?!? They slipped that exemption thru a few years ago, never heard of it til i looked something up after they demanded we pay it. (we sell Ensure = food exemption for sales tax = groceries = litter tax applied to half our sales (or manually calculate correctly which would cost more than paying it)
but hey we have no income tax, but still collect more taxes than most states with em
I kicked off this whole annoying thread by asking "How should NYC pay for the costs of legislating, policing, and judging the protections of the workers while they're telecommunting to NYC businesses?
The real conspicuous absence in the thread is any way to pay for them, or even any recognition that they exist - even while quoting my mention of one example.
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I agree that telecommuters shouldn't pay the full tax in both their physical and their virtual location.
But the total tax bill should depend on what their jurisdictions spend on them. That might not mean the telecommuter bill is the same as the local worker.
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You're talking about a VAT. its the only way to tax things like you are suggesting.
"Money is truthful. If a man speaks of his honor, make him pay cash." Notebooks of Lazarus Long, Robert A. Heinlein
The problem is the various thundering herds of dumbass we call congress and the state legislatures. They have never seen a nickle they can't waste. Remember, they vote for all the spending bills, the President or Governor only signs them. So who is really at fault? Look at Federal spending bills and see what little extras get tacked on to each one as ammendments, most of which have nothing to do with the original bill. That is your so called representatives at work. If OUR money was being spent wisely, the federal budget could be 30% - 50% smaller. Most states have a similar problem.
"If you send it, they WILL spend it" - GWB spring 2001 pushing for tax cuts.
Professional Politicians are not the solution, they ARE the problem.
You're completely missing the point. I know the state of Jersey City. I park there most times I drive up to NYC from Philadelphia. What matters is not the absolute level of services offered by a given location, but the services that are utilized by a telecommuter working in a given location that differ from those in any other. I wouldn't choose to live in Jersey City, but if I choose to live in Manhattan, I will pay much more in city taxes to cover the massively increased city amenities I have available. However, if I work in Jersey City (regardless of where I live) the services I use in order to perform my job are essentially indistinguishable from the ones I would use in Manhattan (or any of the 5 boroughs).
Choice of where to live is important, and property and other local taxes will hopefully reflect (to some extent) the (service-centered) benefits of one location over another. But choice of where to work is orthogonal to this - as a telecommuter I need a space, a functional broadband connection and a way to get between that space and my home if they are not one and the same. You cannot be claiming that by writing software in NYC I am using more city services than doing the same job in Jersey City? Clearly, *living* in NYC I would do so, but as I've now said twice, other non-income based taxes reflect that particular reality.
>Since when has taxation been about fairness?
Taxation is a search for an equilibrium solution just barely under the threshold where the people subject to the tax would rather risk their lives by violently opposing it than paying it.
(Remember, the Boston Tea Party perps would have been summarily hanged for what they did, and let's not kid ourselves about the penalties for armed assault against members of the British Army and Navy.)
So, with that in mind, do you consider this level of taxation tolerable, or do you find it intolerable? Tolerable means you are willing to live another day under the status quo. Intolerable means you would prefer, if it comes to it, to die in an effort to ensure that your progeny will enjoy a better life.
-fb Everything not expressly forbidden is now mandatory.
Our tax system is already full of wierd rules; there's the 'Jock taxes', designed to capture the income of professional athletes who play [n] times a year in a given city. Why not telecommuters?
/shameless plug
It's been noted above that the whole notion of incurring tax simply for having telecommuted 'into' a given place is problematic- sure, the city could mandate it and if they catch you, they can sure curtail your wages... but this simply points to an underlying issue: taxation based on income is already inefficient and hopelessly complex, enforcement isn't funded and probably wouldn't be cost-effective... and it's only getting more complicated as different taxing localities attempt to exploit the fact that income can be accrued remotely because work can be done the same way.
Remember, we live in the country where lawmakers figure it's reasonable to require a person to track where and how they earned all their money, and to use 50+k pages of code that the IRS can't get the same numbers out of more than once.
If I had my druthers, I'd like to see income-based taxation go away, and there's a reform proposal before congress pushing for just that: http://en.wikipedia.org/wiki/FairTax
If there's one thing I won't stand for, it's intolerance.
Business-to-business purchases for the production of goods and services are not taxed.
Doomed. At least, doomed to be unfair, and possibly doomed to be ineffective.
Not only will take on an essentially regressive character by excluding business expenditures, it will quite likely fail to close loopholes unless trusts and other non-personal legal entities are banned or closely watched... by something resembling the IRS, which the tax purports to abolish.
Throw in taxation on business consumption, and it may not take on the imaginary ideal economic efficiency that market fundamentalists leave their teeth under their pillow for, but it would actually work better in the world in which we live.
Tweet, tweet.
The first rule of posting in bunny slippers is not to talk about bunny slippers!
The answer you're looking for, which has been given to you many times in this thread, is "What costs?"
Telecommuting to NYC offers you no protections nor services. Where would I go for unemployment if I get sacked after telecommuting to NYC? Whose ambulence will pick me up if I have a heart attack while on the job? What services of NYC am I consuming?
Anonymous clueless Coward, I'm a rich guy who knows how taxes and finance work. And the English language. So here's another hint: I've never defended double taxation, and even repudiated the implication in several of the posts.
Get a clue, then try posting even once.
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No, the quality of legal and justice services is much better in NYC than in Jersey City. NYC has better value for money spent, due to our economies of scale and the better people we attract to manage it, but we spend more producing much more and better services. Which is one reason why people want to telecommute here: those investments in making this a better place to do business pay off in more money to spend on labor, including telecommuters.
No matter how you spin it, there's no way to say that Jersey City's services are equal to NYC's. Their quality is much lower, and our cost is higher. Someone's got to pay it. The corporations won't, the residents shouldn't pay extra for telecommuters. It's simple: telecommuters should pay for services they consume.
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Businesses choose NYC for lots of reasons, some of which are ...and then again, a lot are leaving. New York is simply pricing itself out of the market.
/used to live in new york
A friend of mine works for Chase here in Columbus, noting that there are people in Manhattan making $200k/year doing what a person in Columbus does for $75k/year.
Unless those people are magically 2 1/2 times more productive, it'll be difficult to justify their current situation.
As an economist, I'm curious to see what happens.
You've just added some more of the costs that don't apply. But no one has refuted the costs the city has in protecting telecommuters' ability to get paid for their work.
Nor said how to pay for it without taxing telecommuters. Some have said the NYC employer should pay, but they already don't, and the bills we're discussing don't do anything about that.
So as many times as "what costs?" gets asked in this thread, the answer is still the same. Why can't people even read the first sentence of the first post, repeated several times in the thread, when trying to argue with it?
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Your linked article is an organization that is specifically trying to skew numbers in favor of NYC getting additional state money.
NYS has a population of 18.98 million people, while NYC has a population of 8.10 million. For property tax, $21.67 billion comes from outside NYC out of a total of $31.50 billion, for example. Unfortunately, I wasn't able to find an authoritative source to support either your or my own statements about income tax. I wasn't even able to find a decent salary distribution for NYC vs. the rest of the state.
By the population numbers, NYC *should* be getting less than 50% of the resident income tax back in state aid. Please let me know if you find anything that definitely shows either way.
A Value Added Tax is a kind of sales tax. There are other ways to charge sales tax, but a VAT is OK, when the different kinds of transactions aren't just a way to game the system.
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but the telecommuters do not consume the type of services you're describing, mostly because US labor law sucks so badly when viewed from an employee perspective that its barely worth it. i just don't see much evidence for this claim you are making that telecommuters draw on services from the community in which their remote office is located. any services.
You can't make taxes simple: it would be bad for accountants and CPAs' business!
Why not move your company HQ on paper to a state with favorable tax laws, and have your NY employees telecomute. /oddly enough also in Colorado and doing work for a company in Tampa.
What do you think keeps telecommuter paychecks coming, corporate honor? Telecommuters are even less naturally protected from exploitation than in-person workers, and the local labor pool. Locals can hear through the grapevine or media not to trust a local employer. Telecommuters are even more isolated and easily replaced from the larger labor pool. It's the local justice department that keeps the employers "honest".
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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?
You do realize that "telecommuting" isn't really commuting? It is just some trendy term for working from your home. The idea that you should be taxed by another state for working out of your own home is pretty rediculous. Very rediculous. Absurd... beyond absurd. So.... it must be the result of government thinking: How can we suck today?
You apparently don't realize that telecommuting is different from traditionally working from home. Because you're simultaneously working at your employer's location.
You also don't know how to spell "ridiculous". Or what "absurd" means. Or how to back up such obnoxious claims beyond just asserting them. Or how to justify the leap from muttering "absurd" to deducing "government thinking".
So there's no sense explaining once again in this tiresome post how telecommuters consume services where they're working virtually. You'll just screw it up beyond recognition.
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Simple - Don't be an employee. Incorporate and invoice the place you are consulting to, then pay yourself dividends. As Ivana Trump put it: Tax is for the little people...
"But no one has refuted the costs the city has in protecting telecommuters' ability to get paid for their work"
How does the city protect the commuters' ability to get paid for their work?
I would say that given our current system and the methods of functionality, leaving the federal government OUT of this would probably be a wise choice.
Although I think a case could be made for the fed having jurisdiction here (true interstate-commerce), they usually complicate any situation they get involved in. The legislation would probably have soo many loopholes and special interest clauses that it would cause more harm than fixes.
My advice is for the states (or the people at least) to work on this without the help of the federal government. The less of a hand they have in things, the better.
Libertas in infinitum
Although I sympathize with telecommuters (I have state residence in NYC, but currently work in Beijing for a client in Atlanta) I doubt this law will end up helping us much. NY goes after a lot of telecommuters because a lot of companys use remote offices as a way to get around paying tax, not because they want to go after the 'little guy on a terminal in Michigan'. The same reasoning applies to people working in NYC but living in NJ or elsewhere, we ask them to pay NYC tax because the City is providing all the infrastructure necessary to help them become successful. It's just not fair for someone to make money because of all the effort and local tax dollars spent to make NYC a good place to do business and not contribute to that effort.
I hear you when you say that why should I pay if I don't live there or if I don't go there to an office. But your clients do live there or work there and they are there because of the huge investment in tax dollars to make NYC a place for you to find clients. Otherwise you'd just find local clients. So it's reasonable to ask for you to pitch into that community effort. I think we just need to come up with a better way to measure that 'pitch in' amount and make sure it's directly tied to your direct benefit and not to pork projects in upstate NY that primarily benefit politicians trying to hold on to thier positions.
My feeling is that this is just another wedge issue, like the marriage penalty tax, that certain people in Washington will use to push through more tax cuts for the wealthy or for corporations. We will get our commuter tax 'relief' but 100 times more in tax breaks to people with enough already will be attached to it.
Personally I think all taxes are too high, but I am wary of people in washington with an agenda riding my annoyance to push through things I am not in favor of.
Peace, or Not?
(Pardon me while I play point/counter-point with myself)
Are you suggesting violence? Well, that's stupid. It's a good way to create a lot of misery and chaos. --In particular, it's a good way to give the administration an excuse to let loose with its big guns and really enact a lock-down. Sorry, but you don't have enough fire-power to contest the government. Have you not read your Machiavelli? He described the very tactic; essentially, political judo with guns. You don't want to go there.
No, the way to go is to fight ignorance. If everybody, including the dupes in the police force and armed forces who are doing the Dark Side's bidding, (and I'm willing to bet it's only some of them), if those guys woke up, then who would remain to heil Bush?
Fight ignorance. If you can wake people up, then you can start to solve things; all the raw workings of the solution are built right into the American system. It just takes awareness and will to make things change.
Enlightened people need not be abused.
-FL
Well you are a typical american, of course you would rather not pay taxes to benefit the state that nurtures your company. You probably would rather not pay any taxes anywhere.
Still though you directly benefit, not just one intangable way fifteen steps down the road.
evil is as evil does
100% ACK.
Now could somebody explain why my simple observation was modded Troll?
Not that I don't enjoy a good bill reading but, do those of you who've perused this have any idea how this will affect offshoring? I assume it would increase the profit margin of those NY businesses that use it to do business in NY.
m
I refuse to fall in to the trap your question frames.
Fact: Consumers of specific services don't necessarily pay in any form for those specific services.
Example: Out of state travelers using state highways. They don't pay for those highways in any form.
I do not support the assumption that services used by telecommuters SHOULD be paid for by those telecommuters.
Anything is possible given time and money.
I just gave an example of a single class of services. There are more services apart from my example. The services in my example form a network of varied services. And within that network, as well as the other more or less directly consumed services, there's an entire government infrastructure that the telecommuters use.
Some states charge tolls on highways. Others subsidize the highways with other fees generated by the out of state travellers, including Federal subsidy.
The fact is that those services generate costs. How to pay them? You're refusing to pay for services that must be paid. And you're not alone. The country has a $10TRILLION debt from that kind of refusal.
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make install -not war
Whoops, unreality shields have been engaged.
You've moved way beyond your initial argument, but I'll give my personal opinion:
Taxes. The federal tax system is a huge, stupid, overly complicated mess. Ditch the whole thing and implement flat tax.
Ditch breaks for corps.
Overly simple? Probably, but that's the best ONE person can suggest with the current state of the mess.
Anything is possible given time and money.
You may be misreading your weekly pay stub.
The state tax refund is treated as "additional" income because it wasn't taxed to begin with. It's withheld from your net paycheck and, therefore, not taxed as income at that time. When you get it back via refund, it goes back in the "taxable income" column and is then taxed - after the fact.
The feds do the same thing, in case you haven't noticed. You're supposed to declare any state tax refunds on your federal return.
In all cases, the one-year-free-loan is accurate, though. And you can adjust your W-4 to deal with that (declare more 'dependents'). Instead of overpaying, just resign yourself to paying at the end of the year, but in which case you get to keep more of your earnings.
Disengage your unreality shields.
The reality is that I just quoted my original post, as I have had to do several times in this post, where no one has explained how to pay for the legal/justice services consumed by adding telecommuters to the operations of a growing company. The reality is that out of state highway users do consume services that are paid for, despite your claims to the contrary. And the reality is that passing the bills we're discussing in these threads does not replace the lost revenue with federal taxes for the services still consumed. Nor will they.
The reality is that you are unable to answer the simple question, so you distract with bad examples, then try to claim some kind of victory when I negate your distraction, as cover for proposing an unrealistic alternative - which I've already said in these threads that I'd prefer, but which is not going to happen any time soon.
You better reengage your unreality shields - you're not handling reality too well.
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make install -not war
If I remember correctly, I was allowed to deduct form my NY State taxes any taxes I had to pay to another taxing jurisdiction, so that I DID NOT PAY TAXES TWICE on the same income.
Sorry guys, but you're probably not going to find your answer online. You will probably need to contact the state comptroller's office and request a county-by-county breakdown (which you should be able to obtain under the Freedom of Information Act). Then, you're going to have to run your own numbers. However, once you're done, you will find out that New York City generates more than it consumes. I say this with confidence because every study that compares urban areas to rural areas ends up with the same conclusion. This includes my own study of Seattle compared to the rest of Washington.
Again, I refuse to allow you to assert that specific services should be paid for by the specific consumer. Hence, your question has no merit and is not worth answering.
Anything is possible given time and money.
You apparently don't realize that telecommuting is different from traditionally working from home. Because you're simultaneously working at your employer's location.
Yes, I don't realize it, because it isn't true. How can you be in two places at once? We are still physical beings. The actual work is done by the person even if that work is conveyed to the employer via the internet, it should be considered no differently than if the person Fedexed the product of the work to the employer. The Internet is just more efficient for conveying information, but it in no way changes the reality of arrangement.
So, would you also assert that help desk employees should also be taxed in the state which confused customers are calling from? After all under your brilliant reasoning, they would be performing work in two different places at once.
You'll just screw it up beyond recognition.
Well, I suppose I was being fairly derisive when I told you you were exercising some government thinking and I am sorry to have offended. But absurd is the correct description of a belief that you can do work in two places at once. "Ridiculous" is just about right too.
Here's something to bounce off your unreality fields, so clearly battened down:
I asked how to pay for those services, which have costs. I didn't say the specific consumer should pay for specific costs. I just asked how to pay for them. My question has its simple merit. Your unreality answers have no merit, and I'm glad I won't have to respond to them anymore.
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make install -not war
Your single fringe case example doesn't prove anything. First off, how often does that really happen that justifies a telecommuter paying for police in NYC? Second, you file a case in NYC, and you'll more than likely have to pay court fees (or perhaps the company will when it loses).
The fact is that there are no services which aren't already being paid for by the telecommuters employer, so there's no reason for the telecommuter to pay taxes to NYC.
Please let us know what day to day expenses are incurred by NYC which aren't being paid for.
Who said the services should be paid by the consumer specifically? I'd love that to be the case, because then I wouldn't have to pay for all the crap of which I don't take advantage or support all the free loaders.
Because its fair. Also, I support the notion of cutting off all the freeloaders. Health care is not a right, nor is it anyones right to force everyone else to pay for that person or thier children.
We're talking about a new law that would also hand free services to telecommuters, too.
What services are being provided for free by NYC to a resident whom telecommutes from NJ?
Example: Out of state travelers using state highways. They don't pay for those highways in any form.
They also pay state sales tax on items bought, as well as gasoline tax. No, its not as much as a resident would pay, but they use taht highway a lot less than residents.
Care to try again?
Why? You think its right for some to freeload off of others? How is that fair exactly?
NYC spends lots of money in ongoing operations that deter employers from abusing employees. Those costs spike when the system fails to prevent the exploitation, but they're spent daily.
Please let us know when employers take care of employees out of the goodness of their hearts.
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I've answered that question a dozen times in this thread, starting with my original post. Try reading the posts, or paying me to do it for you.
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make install -not war
NYC spends lots of money in ongoing operations that deter employers from abusing employees.
Really? Please name some of these ongoing operations; don't forget to detail exactly what these abuses are they the operations are preventing. I suspect that you're full of it.
Those costs spike when the system fails to prevent the exploitation, but they're spent daily.
The only 'explotation' would be a company not paying the telecommuter. And as stated before, the city would recoup any costs via court and lawyer fees paid by one or both parties.
Please let us know when employers take care of employees out of the goodness of their hearts.
How exactly should an employer 'take care' of its telecommuters? They are paid and get benefits, what more do you want? Its not like they can possibly be working in an unsafe environment.
I've gone up the parent trail to your original post. And the only 'service' you describe is 'what if the company doesn't pay its workers.' And I answered that. The juristiction will be NYC, and the COURT fees will be paid by one or both parties.
Outside of that 'company wont pay its workers' scenario you describe, you've offered NOTHING else that NYC provides to telecommuters.
Oh, you also point out that companies don't pay their fair share of taxes. That's a seperate issue, and not a good reason to double tax telecommuters.
So if you present another service (other than a vague reference that somehow NYC is protecting telecommuters from 'abuses') I'd respond it. Hell, just give me a link to a post where you point out something other than the issues I've already addressed.
If you can't provide anything except 'NYC keeps companies from abusing employees' without specfifying the specific abuses which I've already talked about, then you pretty much don't have any case whatsoever.
Since you asked... I live in Minnesota, which that site's data lists as receiving $0.10 less than New York per dollar paid in federal taxes. I'm sure that, in raw dollar amounts, NY is probably doing more to subsidize the rest of the country than MN, but we're paying more out proportionally.
Back on topic, you are right that the odds of a completely fair and just tax system coming out are about the same as pigs landing on the moon (without human assistance), but that still doesn't make overtaxing Peter to undertax Paul right. I must've missed the subthreads where you've said that you think telecommuters should pay less than those who are physically present, so my apologies for not realizing you'd already said it, but I do still believe that the accounting costs of trying to do a fair appraisal of telecommuting work in the general case would be unreasonably high and, to be fair, would have to be applied to all workers, telecommuting or not. e.g., I go in to work at the Minneapolis office, access an intranet server in New York, pull up a remote desktop off a server in Dallas, and then send mail through a company server in San Francisco. If there are telecommuting income taxes, then shouldn't they at least apply to that remote desktop connection in Texas, if not for all three states I touched? If not, why not? I'm making the exact same use of NY, TX, and CA resources by connecting to them from the MN office as if I were doing so from my home, 5 miles away. But if they are assessed, then we have an accounting nightmare, especially when some legislator in Iowa realizes that I'm using a router in Iowa to reach that server in Texas...
Full Faith and Credit shall be given in each State to the public Acts, Records, and judicial Proceedings of every other State. And the Congress may by general Laws prescribe the Manner in which such Acts, Records and Proceedings shall be proved, and the Effect thereof.
It is naturally a federal power to prescribe under which state's jurisdiction income is earned. Of course they could use the commerce clause anyway, since under current precedent the commerce clause authorizes just about anything.
1) Of course I benefit from New York's public services. I also benefit from Florida's public services. I also benefit from the French medical system. Given that we live in a very global economy, my company benefits fairly directly from the public service programs in most states and many foreign countries. I think it's great that those services exist, and I think that the world is a better place for it. That's not the question, though. The question is, should I be paying income tax on all of my income in every country in the EU, half of East Asia, and 35 out of 50 states in the US to cover services that only peripherally benefit me, or is there a more logical way of doing it, like taxing the businesses that make use of my services there?
2) Why on earth are telecommuters who earn their money in NY taxed as NY residents when wealthy out of state investors who make most of their money trading on the NYSE or NYMEX aren't? What about people who work for mail order companies that send most of their goods to New York? Should they pay full income tax in both states? Computers are wonderful things, but they can't allow you to be in two places at once, and there's no reason to write weird laws that pertain specifically to them and gouge telecommuters and not others whose income is earned in similar patterns.
This is not a question of not wanting to pay taxes at all, or even not being willing to pay taxes that don't directly benefit me for the good of a healthy society from which I benefit. It's a practial matter of sensible policy that extracts reasonable contributions from everybody in a particular constituency. We all clearly can't afford to pay income tax on 100% of our income in all 50 states, even though we benefit as a whole from the healthy governance of all of them. You seem to think that my proposal is an "every man for himself" solution of abolishing those government services. In reality, I'm just proposing that state residents pay for services that directly affect them and that any extra burden caused by the cost of interstate commerce should be borne by the businesses who take part in that commerce. Sure, the businesses would pass their costs on to consumers in the form of higher prices and employees in the form of lower wages, but that pattern would more reasonably reflect who is actually causing the public to incur the extra costs, and I doubt it's going to ruin anybody.
New York's current system is just a cynical attempt to extract some free tax money from a class of people who can't vote in local elections and thus have no recourse. It's a great way of raising taxes while still staying popular with your local constituency ("We'll just get those other guys to pay for it!"), but it's not espeically fair, and I would argue that it produces a larger deadweight loss in the nationwide economy than a more equitable structure that maintains the same services.
An interesting anagram of "BANACH TARSKI" is "BANACH TARSKI BANACH TARSKI"
Having said all that, NY truly is notorious for taxing income based on the slimmest legal nexus. California is bad about taxing overseas earnings of multinational corporations. US ex-patriates have a hard time escaping federal income tax (compared to Europeans at least...but that may be more a result of Europe's multi-state political landscape, making the ex-patriate situation more common & therefore more logically addressed). Income tax and cross-border commuting are too new for common-law principles to have been worked out for these situations.
Man, you think regular income tax is bad, try filing 3 or 4 state returns, where the rules for filing and accounting for which income goes where (or whether you have to file or not) are vague. Arrgh!
Very interesting. Could you elaborate more on what type consulting you do...what area of the country? Are you completely indie...or work for a consulting firm?
Light travels faster than sound. This is why some people appear bright until you hear them speak.........
Who said life was fair?
Fact: People free load off others.
Arguing the rightness of that serves no purpose. Talking about changing the state of things, that has purpose.
All done here.
Anything is possible given time and money.
The world is not black and white. I benefit from hick in montana milking cows and some rancher in Argentina rasing a herd of delivious cows but it's not REASONABLE for me to pay tazxes in those places. But it's REASONABLE that I pay taxes when I telecommute to another state.
evil is as evil does
Party affiliation is a joke. The democraps add just as much waste to every spending bill as the repulipricks do. They ALL spend worse than a "drunken sailor", I should know since I used to be one! USN Submarine Service 1976 - 1980.
Professional Politicians are not the solution, they ARE the problem.
I'm forced to wonder, though, why just telecommuters? Why not financial instrument traders? Why don't people living near the border of two states pay full income tax in both of them? I think it might have something to do with drawing reasonable lines and the inablity to make a fair estimate of what they should be paying. Why that doesn't apply to telecommuters is anybody's guess.
An interesting anagram of "BANACH TARSKI" is "BANACH TARSKI BANACH TARSKI"
"I'm forced to wonder, though, why just telecommuters? Why not financial instrument traders? Why don't people living near the border of two states pay full income tax in both of them?"
Again it all has to do with reasonableness.
evil is as evil does
Who said life was fair?
I dunno, we all seem to have some embedded sense of what is fair and what is not.
Fact: People free load off others.
That doesn't make it right. Let me try one.
Fact: People kill other people.
Well, I guess that settles it. We shouldn't bother with murders anymore. I guess its just unfair.
Arguing the rightness of that serves no purpose. Talking about changing the state of things, that has purpose.
Um, arguing that something is wrong usually has to be the first step into changing things, don't you think?
All done here.
Good. What a useless post that was..