Have your employees relocated amid the new work-from-home reality? Be sure to consider the state payroll tax implications for your company.
As the COVID-19 pandemic grinds on and the new normal of working from home feels increasingly permanent, many U.S. workers have discovered a silver lining in the ability to relocate without changing jobs. Whether they move to be closer to a beach or nature or family, employees have proven that they can remain engaged and effective hundreds of miles from their companies’ physical offices.
The growing remote workforce presents tax implications, though, for employers whose workers now reside and work in a different state than where the company is based. Under these circumstances, the employer might be subject to a new set of state and local taxes – whether due to tax nexus for the company or, the focus of this article, employer payroll tax obligations. Companies should consider putting processes in place today to prepare for a future in which working remotely remains the norm.