Legislation recently introduced in the U.S. House would make it easier to file taxes during the COVID-19 pandemic.
In many states, income taxes are paid according to where an employee works, not the location of the employer. This could cause remote workers to unknowingly incur taxes in a state other than where they typically work.
Under the Remote Worker Relief Act, remote employees would continue paying state taxes in the jurisdiction of their place of work, not where they are temporarily residing.
“The Remote Worker Relief Act will provide certainty for workers, businesses, and state governments as we navigate one of the most challenging public health crises we’ve faced as a nation,” Rep. Mary Gay Scanlon (D-PA), who introduced the bill, said. “This bill maintains the status quo for state income taxes and income earned by remote workers living in a tax jurisdiction different from their place of work for the 2020 tax year. This will prevent remote workers from bearing the onerous burden of determining which states they may owe taxes to.”
More than 33 percent of the American workforce is working remotely as a result of the pandemic, and many employees are working in different locations than where their employer is located.