How Do Taxes Work for Remote Employees? It's Complicated.
Is april fifteenth tax day. Except it's not the. Irs has extended as yours deadline to file and people like myself now have until may seventeenth to get those forms in but if you're one of the millions of employees who work remotely in the last year you may find some surprise taxes you haven't heard about yet. Luckily my colleague. ronnie. Mola is here to explain ronnie. Hey peter you know used to sit next to each other day after day after day and then the pandemic came and you went away to an undisclosed location somewhere north of new york city as it going up there colder than where you are but pretty good. It's colder and are your taxes any different because you because you live upstate. So for me. It's not that different Because i used to live in brooklyn. Now i've moved upstate within the same state so it's just a matter of you know just paying taxes where i live but to another state. Say like texas or tennessee. You might be a different situation. Why is up. Your taxes are generally based on where you're physically doing the work like where you're sitting in sweatpants and typing on your computer except in the case of these convenience role states which were these states that say hey we're gonna tax you based on where your job is located which kind of just like a whole wrench into how this normally works. So the convenience will states are states like new york arkansas connecticut. There's a they're seven of them and convenience rule states say that they're going to tax you based on where your office is where your job has an office not based on where you're physically working So that's obviously a big deal in the pandemic when a lot of people are no longer working Where their offices and they might be in a completely different state okay. I'm half following. So let's say you had moved to texas along with everyone else in technology. What would happen to your taxes for your current job at vox which is based in new york city since if i had moved to texas a state that has no income tax and it sounds like that's gonna be awesome because i'm going to get to keep more of my money because new york where my job has. An office is a convenience rule state. I actually still have to pay new york income tax. If my job had an office in another state say like tennessee or florida or any of the other non convenience role states i would pay taxes based on where i'm living in that case it would be texas.