Timeline for Why does a US company need to know the location of their employees for tax purposes?
Current License: CC BY-SA 4.0
10 events
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| May 26, 2020 at 16:08 | comment | added | Lee C. | @Zibbobz You would most likely want to file a W-4 when moving to a new state, but I doubt it's typical. While some states have their own withholding forms (e.g. California's DE-4) other states require employers to rely solely on the numbers entered on the federal W-4 to calculate state withholding. For most people who move but continue to work for the same employer, filing a new W-4 is probably completely off their radar. | |
| May 26, 2020 at 14:56 | comment | added | jamesqf | Not entirely true that employees are taxed where the work occurs. It's often a matter of where the facility you work from is located. For instance, I once worked for a large company with facilities in many states. I was employed by one of their Bay Area labs, and so paid California non-resident taxes on all my salary, even though about half my working time was spent in my home state. | |
| May 26, 2020 at 12:58 | comment | added | Zibbobz | @FranckDernoncourt Typically if you're moving to another state, you would file a second W2 (wouldn't that be a W4 actually?) form for tax withholding in that state - you would wind up paying partial income tax in both states based on how much you earned in each one that year. Related information in this question: money.stackexchange.com/questions/125533/… | |
| May 26, 2020 at 3:42 | comment | added | Franck Dernoncourt | Follow-up: Which US states penalize an employer if they withhold taxes for the wrong state for one of the employees? | |
| May 25, 2020 at 21:12 | comment | added | Andrew Timson | If the employer withheld nothing, then the employee got that money in their paychecks as they went along. If the employer withheld taxes for the wrong state, the employee would need to file a return with the incorrect state to get the money refunded (meaning they'd need to file two state returns for the year). Whether there's a penalty for the employer would depend on the state, as well as whether the employer has any physical presence there. (My state's website doesn't list any penalty details that I can find, just the requirement for withholding if the company has a physical presence.) | |
| May 25, 2020 at 21:05 | comment | added | Franck Dernoncourt | Thank, wouldn't the employee receive the amount that the employer withhold? Also does the employer incur any penalty or other trouble? | |
| May 25, 2020 at 21:03 | comment | added | Andrew Timson | The employee will be required to pay the full amount when filing their annual tax returns (depending on the state, this could be up to 13% of their gross income for the year). They may also need to pay an additional penalty for underwithholding. | |
| May 25, 2020 at 20:57 | comment | added | Franck Dernoncourt | Thanks. What happens if a company doesn't perform tax withholdings and communicate W2 in the state the employee is located, e.g. if the employee changed state or moved outside the US? | |
| May 25, 2020 at 20:56 | review | First posts | |||
| May 26, 2020 at 2:14 | |||||
| May 25, 2020 at 20:53 | history | answered | Andrew Timson | CC BY-SA 4.0 |