4 ms·

> 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

> 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).
- withinboredom 5y ago
  Sorta. If you’re a small company, you can just charge your home VAT. Registering for MOSS and paying out all VAT based on location of the sale would be something you do with your accountant when you get a little bigger.

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).
withinboredom 5y ago
Sorta. If you’re a small company, you can just charge your home VAT. Registering for MOSS and paying out all VAT based on location of the sale would be something you do with your accountant when you get a little bigger.