OSCPA staff report
Ohio Senator Sherrod Brown on April 21 reintroduced OSCPA-backed legislation that would ensure that mobile workers do not face unexpected or increased state income tax bills.
Brown, who has maintained a strong working relationship with The Ohio Society of CPAs, co-sponsored the Remote and Mobile Worker Relief Act with Sens. John Thune, R-S.D.
The act would create uniformity for nonresident tax withholding across states and local jurisdictions, and a de minimis exemption. Similar to mobile workforce bills that OSCPA and the AICPA have supported in the past few sessions of Congress, this legislation includes language tailored to remote workforce tax issues created by the pandemic, such as those faced by medical professionals who traveled to hard-hit areas.
“We’re grateful for Senator Brown’s consistent leadership in keeping this issue active,” said Barb Benton, CAE, OSCPA’s vice present of government relations. “OSCPA will continue to work with Senator Brown and the AICPA in seeking passage of this much-needed legislation.”
The Remote and Mobile Worker Relief Act would:
- Provide uniformity in state and local income tax assessment and withholding obligations for employees that may travel on behalf of their employer to work in a state that is different from the state where they reside.
- Establish a permanent 30-day threshold before any income tax obligations can be enforced by the non-resident state. For the tax years 2020 and 2021, the threshold is set at 90 days to help ensure that medical professionals and other workers who traveled to support areas hard hit by the COVID-19 pandemic do not face unexpected or increased state income tax bills from these states.
- Preserve the status quo by allowing employers to continue to assign the income for employees temporarily working remotely due to the COVID-19 pandemic at their pre-pandemic work location versus the location where they may have been working remotely. For example, if you are generally taxed in Michigan because your job is there, but you live in Ohio, your tax situation wouldn’t change simply because you worked from home during the pandemic. These provisions provide much needed certainty by placing states, employees and their employers in the same position they would have been in pre-pandemic. This particular provision is only applicable for the 2020 and 2021 tax years.