David Woods, EA, ChFC, CLU wrote:
- quote -

The fact that a company has one or more employees performing
services of any kind for it in a state generally gives it a
physical presence in that state. As a result, the state may
not only require the company to withhold and pay over state
(and local, if applicable) income taxes on the employees'
wages, but also to report them to that state for
unemployment insurance purposes as well. In addition, if
such a company makes sales to customers in the state where
the employee resides, it may also have an income/franchise
tax filing requirement in that state.

However, suppose the employee resides in MA, to use David's
example, where the employer has no presence, but performs
all of his services for the employer in RI. MA could not
require the employer to withhold income taxes on the
employee's wages, because the employer has no nexus with MA.
RI, however, could require withholding.

Katie in San Diego

The foregoing is intended for educational purposes only and
does not constitute legal or professional advice.

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"David Woods, EA, ChFC, CLU" <dwoods[at]woods-financial.com> wrote:
- quote -

That's not quite the example I gave, Dave. I said a sales
rep that lives AND works in a different state than the
company. I will agree that my last sentence was a bit
ambiguous. To clarify, I'm talking about a sales rep type
of employee that works out of his residence for an out of
state employer. The employer withholds taxes for the
employee's state of residence. His base of operation is his
residence, he may cover, or work in as you say, other
states, but the company does not have to withhold taxes for
those other states.

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"Bob V" <transition[at]yahoo.com> wrote:
- quote -

Well THAT'S not true. The company is required to withhold
taxes in the state the employee works in. If I worked in
Rhode Island even though I'm from Massachusetts, I would be
withheld in RI, not MA. Here's a good reason why: What if
the company in question didn't operate in your home state?
What right, or principle exists that would allow your home
state to issue or enforce an order of withholding on your
wages? None.

--
David M. Woods, EA, ChFC, CLU
Woods Financial Services
Norwood, MA 02062
www.woods-financial.com

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<AntiSPAM_g9u5dd43[at]yahoo.com> wrote:

- quote -

I am in the same situation. You pay to your state of
residence. It's the same thing as a company employee, such
as a sale rep, that lives and works in a different state
than the company. The company is required to report, and
the employee is required to pay, taxes to the employee's
state of residence.

Bob

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<AntiSPAM_g9u5dd43[at]yahoo.com> wrote

- quote -

In your case, since all the work is performed in Indiana,
where it happens you also live, then that is the only state
in which you need to file.

--
Paul A. Thomas, CPA
Athens, Georgia
taxman at negia.net

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AntiSPAM_g9u5dd43[at]yahoo.com wrote:

- quote -

The state where you LIVE.

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AntiSPAM_g9u5dd43[at]yahoo.com wrote:

- quote -

Nope. Indiana all the way.

ChEAr$,
Harlan Lunsford, EA n LA

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USA State Tax Question:

I telecommute for a company on a 1099 contract basis. The
company is located in a state (MA) that is not my state of
residence (IN). I perform all the work in my state of
residence. When I file my state taxes, do I pay tax on
that income to the state that I reside or to the state where
the company resides that paid that income?

(i.e., am I required to file MA state tax while living in IN
because I obtain income from a business in MA, although I
was not working in MA)?

g9u5dd43[at]yahoo.com

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