A bill designed to simplify state income tax reporting and withholding rules for employees who travel and work across state lines is a step closer to becoming law.
H.R. 1393, the Mobile Workforce State Income Tax Simplification Act of 2017, has passed the U.S. House of Representatives. The bipartisan legislation would create a uniform national standard that would eliminate the compliance maze many employers and employees currently confront. Under the bill, “employees would only be subject to another state’s taxes if they worked there more than 30 days per calendar year,” reports Accounting Today’s Michael Cohn. “An employee’s earnings would still be subject to full tax in their state of residence, however.”
Maryland Rep. C.A. “Dutch” Ruppersberger is a co-sponsor of the legislation.
“We appreciate Rep. Ruppersberger’s support in sponsoring the measure,” said MACPA Executive Director Tom Hood. “His involvement was instrumental in the bill’s passage.”
American Institute of CPAs President and CEO Barry Melancon called the House passage “a victory for taxpayers and their employers.”
“Enactment of H.R. 1393 would eliminate the need for much of the complex record-keeping that employers face when their employees cross state lines to work,” Melancon said. “It also would relieve many workers of the burden of filing state income tax returns for states in which they worked only a few days during the year.”
The legislation now awaits action in the Senate, where it has been introduced as S. 540. The AICPA and the MACPA are among the associations that are working with leaders of the Senate Finance Committee to move the bill forward in the Senate.
“The MACPA joins the AICPA in urging the Senate to pass its companion bill soon so that thousands of employers and employees can be relieved of the burden imposed by inconsistent state tax laws,” Hood said.
Pictured in the photo above are members of the MACPA delegation that participated in the profession’s congressional visits in Washington, D.C., in May. From left: Randi Reed, a member of the MACPA’s Mentoring Program; Samantha Bowling, secretary / treasurer of the MACPA’s Board of Directors and Reed’s mentor; and former MACPA Board chairs Anoop Mehta, Allen DeLeon and Byron Patrick.
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