State Income Tax on Nonresident Workers

Today’s mobile workforce is being penalized by state income tax rules. A bill introduced in Congress, called the Multi-State Worker Tax Fairness Act of 2016 (S. 2813), would limit the authority of a state to tax income earned by a nonresident worker. Under the measure, a person would need to have a physical presence in a state in order to be taxed by it; telework won’t create a physical presence.