Common-sense, bipartisan tax legislation can and does pass quickly in Congress! Today, the House passed, by voice vote, the Mobile Workforce State Income Tax Simplification Act (HR 1864), a bill that establishes an easy-to-understand rule on taxing out-of-state workers that helps both employees and employers. Currently, a maze of state income tax laws apply to employees who temporarily work in nonresident states and their employers who are responsible for withholding taxes for these traveling employees.
The House recognized the absurdity of this patchwork of different state income tax rules and passed HR 1864, which establishes a simple and fair test: a temporary worker needs to work in a nonresident state for more than 30 days before he has to pay income taxes to the state he’s visiting.
The NAM letter sent 5/14 to all House offices voiced support for this bill and urged prompt passage of this legislation on behalf of many manufactures and their workers, who are getting trapped by onerous compliance burdens and different state income tax liabilities. The compliance burden is particularly problematic for small and medium size companies that do not have in-house tax departments to calculate the employee’s tax liability and the necessary employer’s tax withholding requirements.
The bill now advances to the Senate and manufacturers urge Senators to act quickly on this common-sense, bipartisan legislation. To learn more about the issue, click here.