If You Worked Remotely Due To COVID-19

A state tax surprise could be coming



If you worked remotely from a different state while waiting out the pandemic, you just might wind up facing a tax surprise when you file next year.

That's because the longer you work away from your home base, the higher the likelihood you could have tax reporting and payment obligations in your temporary location.

Indeed, more than half of remote workers polled by the American Institute of CPAs said they were unaware that they could face tax consequences if they didn't adjust their state tax withholding to reflect their work situation.

Further, more than 7 out of 10 of the remote workers were unaware that telecommuting from a different state could affect the amount of state taxes owed, the institute found.

The organization polled 2,053 American adults in October.

"If you're working in multiple states during the year, it causes complexity," said Eileen Sherr, CPA, director for tax policy and advocacy at the AICPA.

"When these people file, they will owe money if they haven't had any tax withholding in that state, so they need to change their withholding, so they don't have a big payment in April," she said.

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Source: CNBC

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