5 ms·

The tax implications in the US alone are fairly complicated. I expect they will get more complicated as stated wise up to companies based in one place but with

by tjr225 5y ago

The tax implications in the US alone are fairly complicated. I expect they will get more complicated as stated wise up to companies based in one place but with workers in others. A few years ago I was at an all remote company and there were several all staff emails along the lines of: “you absolutely need to talk to your manager before you move to another state.” Certain states were not allowed. I’m not positive but I think you owe state income tax in the state that you are physically in even if it is only for a couple of weeks or a month or so. Think of all of the tax fraud that has happened in the last two years.

ghaff 5y ago
>I’m not positive but I think you owe state income tax in the state that you are physically in even if it is only for a couple of weeks or a month or so. The details vary by state. In some it's as short as one day but there may also be some minimum dollar cutoff--the laws are basically aimed at pro athletes and entertainers. I know I didn't have to file out of state taxes this year for some short business travel; all our expense reports are now audited for out of state working days. Of course, you can usually get off with a certain amount of personal digital nomadism if you're not filing expense reports. But working for extended periods of time is getting into tax fraud territory. And you're absolutely right that a lot of people have been doing it, often without really thinking about it.
- bombcar 5y ago
  I’ve heard that baseball player taxes are an absolute nightmare because they have to file in every jurisdiction their team plays in.
  - jleyank 5y ago
    Including Canada. Well, at least non-covid Canada. I’m sure the team or the union has a healthy list of CPA’s and lawyers who specialize in this. More so in hockey, possibly soccer as well.
    - verve_rat 5y ago
      So there should be a body of knowledge and experienced people to handle all this. The employers and employees involved just need easy access to this. Sounds like a nice way for some accounting firms to expand their market.
      - ghaff 5y ago
        Oh, it's easy to track. And my accountant would have no trouble filing a bunch of additional state tax forms for me. But it would probably cost me a couple thousand dollars.
autarch 5y ago
> I’m not positive but I think you owe state income tax in the state that you are physically in even if it is only for a couple of weeks or a month or so. Think of all of the tax fraud that has happened in the last two years. Just to clarify, the important "you" here is your employer. In many (if not all) states, having a full time employee work from a state establishes a tax nexus there, making the _employer_ liable for collecting sales taxes (if applicable) and requiring them to pay taxes on their business income to the state (again, if applicable). It's the taxes on business income that can be quite painful for the employer. If the state has particularly high taxes, employing just a single person in that state may not be worth the additional cost in taxes. This is all completely insane, of course. Doesn't the EU, made of actual separate countries, have a solution for this? So why can't the regions of _a single country_ do the same thing? Because we're a dysfunctional mess of a country, that's why!
- Sebguer 5y ago
  I'm pretty sure the 'EU' solution for this is just that you are responsible for collecting VAT in every single country, regardless of any nexus. It's not actually really any simpler, but it does mean that taxation is no longer tied to a business presence. Specific tax laws still vary between countries.
  - autarch 5y ago
    I'm no expert on VAT, but it seems like this is a lot more like the sales tax case, where you are required to pass the cost on to customers. I'm sure companies prefer to avoid this, but it doesn't seem like it'd be nearly as strong a disincentive as having to pay business income tax in another state.
    - Sebguer 5y ago
      Oh, fair, I hadn't thought about it from that perspective. I think the challenge is that you still have to know the VAT nuance (and categories) for every country you operate in, and failure to do so correctly will result in you getting a tax bill, regardless. I don't think it's actually any less burdensome than the US' system, but I'm also not an expert on either system (just adjacent exposure working around it).
fallingknife 5y ago
States should ditch the income tax altogether in favor of sales tax. Then you are paying where you are located no matter what. No "residency" concept (and all it's associated bureaucracy) is needed.
- withinboredom 5y ago
  This doesn’t work. Taxes don’t just pay the governments bills, they also work to make sure the rich don’t get too rich (otherwise your land owners could get richer than the government and toss you out of power). We are literally watching this happen in the US where the rich are too rich and basically do what they want.
  - fallingknife 5y ago
    The highest state income tax rate is 12.3% in CA. This is not the difference between rich people getting too rich or not.
    - withinboredom 5y ago
      Yeah, compare this to countries that have been doing taxes for nearly a millennium and it’s around 50% once you make enough.

by tjr225 5y ago

ghaff 5y ago

>I’m not positive but I think you owe state income tax in the state that you are physically in even if it is only for a couple of weeks or a month or so. The details vary by state. In some it's as short as one day but there may also be some minimum dollar cutoff--the laws are basically aimed at pro athletes and entertainers. I know I didn't have to file out of state taxes this year for some short business travel; all our expense reports are now audited for out of state working days. Of course, you can usually get off with a certain amount of personal digital nomadism if you're not filing expense reports. But working for extended periods of time is getting into tax fraud territory. And you're absolutely right that a lot of people have been doing it, often without really thinking about it.

bombcar 5y ago
I’ve heard that baseball player taxes are an absolute nightmare because they have to file in every jurisdiction their team plays in.
- jleyank 5y ago
  Including Canada. Well, at least non-covid Canada. I’m sure the team or the union has a healthy list of CPA’s and lawyers who specialize in this. More so in hockey, possibly soccer as well.
  - verve_rat 5y ago
    So there should be a body of knowledge and experienced people to handle all this. The employers and employees involved just need easy access to this. Sounds like a nice way for some accounting firms to expand their market.
    - ghaff 5y ago
      Oh, it's easy to track. And my accountant would have no trouble filing a bunch of additional state tax forms for me. But it would probably cost me a couple thousand dollars.

autarch 5y ago

> I’m not positive but I think you owe state income tax in the state that you are physically in even if it is only for a couple of weeks or a month or so. Think of all of the tax fraud that has happened in the last two years. Just to clarify, the important "you" here is your employer. In many (if not all) states, having a full time employee work from a state establishes a tax nexus there, making the _employer_ liable for collecting sales taxes (if applicable) and requiring them to pay taxes on their business income to the state (again, if applicable). It's the taxes on business income that can be quite painful for the employer. If the state has particularly high taxes, employing just a single person in that state may not be worth the additional cost in taxes. This is all completely insane, of course. Doesn't the EU, made of actual separate countries, have a solution for this? So why can't the regions of _a single country_ do the same thing? Because we're a dysfunctional mess of a country, that's why!

Sebguer 5y ago
I'm pretty sure the 'EU' solution for this is just that you are responsible for collecting VAT in every single country, regardless of any nexus. It's not actually really any simpler, but it does mean that taxation is no longer tied to a business presence. Specific tax laws still vary between countries.
- autarch 5y ago
  I'm no expert on VAT, but it seems like this is a lot more like the sales tax case, where you are required to pass the cost on to customers. I'm sure companies prefer to avoid this, but it doesn't seem like it'd be nearly as strong a disincentive as having to pay business income tax in another state.
  - Sebguer 5y ago
    Oh, fair, I hadn't thought about it from that perspective. I think the challenge is that you still have to know the VAT nuance (and categories) for every country you operate in, and failure to do so correctly will result in you getting a tax bill, regardless. I don't think it's actually any less burdensome than the US' system, but I'm also not an expert on either system (just adjacent exposure working around it).

fallingknife 5y ago

States should ditch the income tax altogether in favor of sales tax. Then you are paying where you are located no matter what. No "residency" concept (and all it's associated bureaucracy) is needed.

withinboredom 5y ago
This doesn’t work. Taxes don’t just pay the governments bills, they also work to make sure the rich don’t get too rich (otherwise your land owners could get richer than the government and toss you out of power). We are literally watching this happen in the US where the rich are too rich and basically do what they want.
- fallingknife 5y ago
  The highest state income tax rate is 12.3% in CA. This is not the difference between rich people getting too rich or not.
  - withinboredom 5y ago
    Yeah, compare this to countries that have been doing taxes for nearly a millennium and it’s around 50% once you make enough.