Two members of the tax-writing Senate Finance Committee have reintroduced a measure designed to simplify tax collection for those who work in multiple states.
Sens. John Thune (R-SD) and Sherrod Brown (D-OH) said the Mobile Workforce State Income Tax Simplification Act seeks to simplify and standardize state income tax collection for employees who travel outside of their home state for temporary work assignments while also aiding employers who must comply with withholding and reporting requirements.
“The name of our bill says it all,” Thune said. “If enacted, it would simplify state income tax filings by creating a common-sense, across-the-board standard for mobile employees who spend a short period of time during the year working across state lines. Imagine how complicated and unfair it is for an individual who lives in a state like South Dakota, with no state income tax, to have to file income taxes in multiple states for simply temporarily working in those states and not be able to recover any income tax payments he or she has to make. The current framework is overly burdensome and this legislation would provide much-needed relief.”
Under current law, individuals and employers face different state income tax reporting requirements in almost every state that vary based on length of stay, income earned, or both.
“We should be making it easier, not harder, for workers to support themselves and their families,” Brown said. “We live in a highly mobile society. People travel across state lines for work. We should be cutting red tape and simplifying the state income tax filing process to help these workers get ahead.”