Identify work locations, employee residences, reciprocity, unemployment accounts, and registrations needed when employees work across state lines.
Answer a few quick questions below. It is private - nothing is submitted or stored - and takes about a minute.
Informational multistate tax screening only; state and local rules vary and must be verified for the applicable year and jurisdiction.
Here is what the checker asks and why each step matters. Prefer to talk it through? Contact us and we will help directly.
Wages are commonly sourced to where the work is actually performed, so a single employee working in a new state can create a withholding and registration duty there.
Confirm the single-state footprint and keep watching for out-of-state work; with no employee working in an unregistered state, no new withholding or registration duty arises under those states' wage-sourcing statutes.
Official guidance: Official state tax agency directory
A remote worker's home commonly creates both payroll-withholding duties and business (income/franchise) nexus for the employer in that state, even with no physical premises there.
Register for withholding and screen for the business nexus the remote worker creates, since in-state activity beyond solicitation of orders forfeits P.L. 86-272 income-tax protection.
Official guidance: Official state tax agency directory
Under a reciprocity agreement the employee files a certificate and you commonly withhold only for the residence state, not the work state - but this applies only between the specific states that have signed one.
Collect the nonresident exemption certificate and switch withholding to the home state under the two states' wage reciprocity agreement.
Official guidance: Official state tax agency directory
Many states start requiring nonresident withholding once an employee works more than a set number of days or earns above a wage figure there - commonly cited thresholds vary widely, so each state's current rule needs confirming.
Allocate wages by workday and withhold to each state once its nonresident day or wage threshold is met, consistent with Multistate Tax Commission mobile-workforce recommendations.
Official guidance: Official state tax agency directory
A few states tax wages of a remote employee assigned to an in-state office as if earned in-state - even for days worked at home elsewhere - which can expose the worker to double taxation unless a resident credit or spared employer approach is coordinated.
Coordinate the convenience-rule sourcing with the employee's resident-state credit under Comptroller of the Treasury of Maryland v. Wynne, 575 U.S. 542 (2015), to prevent double taxation. Register for withholding in the state where the employee works, per that state's wage-sourcing and employer registration statutes.
Official guidance: Official state tax agency directory
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