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> company needs to account for employee locations to avoid violating tax laws Serious question: can some tax-savvy individual explain what the relevant tax law

> company needs to account for employee locations to avoid violating tax laws Serious question: can some tax-savvy individual explain what the relevant tax laws are? How much could a worker's tax residence affect the corporation's tax liability?

burlesona 6y ago
Many (most?) taxes are state and local, as most services are operated at the state and local level. The most obvious example that comes to my mind is unemployment. Each state has a different unemployment program, and every employer must pay in a certain amount for each employee in the state.
ProjectArcturis 6y ago
If you live most of your days in Missouri, you are a Missouri resident and you need to pay Missouri state income taxes, and maybe local income taxes as well. If you/your company is paying California income tax instead, that's a problem for both of you.
- User23 6y ago
  There are no bright lines in residency law in the USA. You can potentially reside in one state for five months and the other for seven but be domiciled in the former. This is an area where you really ought to rely on professional advice.
- ArtDev 6y ago
  And, if you live in a country that does not tax resident foreigners whose entire income is foreign, you pay no income tax at all. The only countries I know that do this cheaply are Costa Rica and Uruguay (the Bahamas have expensive requirements). One technique is to not live anywhere more than six months but be a residency in one of those countries. I haven't done this because I have kids and pets.. but it seems pretty awesome if you make a competitive salary (not Facebook!).
cortesoft 6y ago
A lot of states have payroll taxes, which the employer has to pay for each employee working in that state.
gamblor956 6y ago
It doesn't. The employer is responsible for paying taxes on behalf of the employee, i.e. income and payroll taxes. This is the case in most of the modern world...
- seanmcdirmid 6y ago
  Only for w2 income. Or if they aren’t an employee, rather a contractor and earn 1090 income, then the onus is on the contractor.
  - gamblor956 6y ago
    We are taking about employees, not independent contractors... But if you want to get technical, withholding does apply to contractors in international cross border situations.
anomaly_ 6y ago
In addition to the domestic state payroll/income tax issues mentioned by others, it's almost certain FB is also talking about the risk of creating foreign permanent establishments of the FB US entity from an international tax perspective.

burlesona 6y ago

Many (most?) taxes are state and local, as most services are operated at the state and local level. The most obvious example that comes to my mind is unemployment. Each state has a different unemployment program, and every employer must pay in a certain amount for each employee in the state.

ProjectArcturis 6y ago

If you live most of your days in Missouri, you are a Missouri resident and you need to pay Missouri state income taxes, and maybe local income taxes as well. If you/your company is paying California income tax instead, that's a problem for both of you.

User23 6y ago
There are no bright lines in residency law in the USA. You can potentially reside in one state for five months and the other for seven but be domiciled in the former. This is an area where you really ought to rely on professional advice.
ArtDev 6y ago
And, if you live in a country that does not tax resident foreigners whose entire income is foreign, you pay no income tax at all. The only countries I know that do this cheaply are Costa Rica and Uruguay (the Bahamas have expensive requirements). One technique is to not live anywhere more than six months but be a residency in one of those countries. I haven't done this because I have kids and pets.. but it seems pretty awesome if you make a competitive salary (not Facebook!).

cortesoft 6y ago

A lot of states have payroll taxes, which the employer has to pay for each employee working in that state.

gamblor956 6y ago

It doesn't. The employer is responsible for paying taxes on behalf of the employee, i.e. income and payroll taxes. This is the case in most of the modern world...

seanmcdirmid 6y ago
Only for w2 income. Or if they aren’t an employee, rather a contractor and earn 1090 income, then the onus is on the contractor.
- gamblor956 6y ago
  We are taking about employees, not independent contractors... But if you want to get technical, withholding does apply to contractors in international cross border situations.

anomaly_ 6y ago

In addition to the domestic state payroll/income tax issues mentioned by others, it's almost certain FB is also talking about the risk of creating foreign permanent establishments of the FB US entity from an international tax perspective.