The Senate Mobile Workforce State Income Tax Simplification Act of 2017, S. 540, has reached an important milestone. It has 52 bipartisan co-sponsors, more than half of the U.S. Senate’s 100 members.
The bill would simplify state income tax reporting and withholding rules for employees who sometimes work outside their home states and has long been supported by the American Institute of CPAs (AICPA) and the state CPA societies.
S. 540 is sponsored by Senators John Thune (R-S.D.) and Sherrod Brown (D-Ohio) and is identical to the bill passed by the U.S. House of Representatives by a voice vote on June 20.
The two bills would create a uniform national standard so that employee earnings would not be subject to state income tax and withholding outside their home state unless the employee worked in a state for more than 30 days during the calendar year. However, under the legislation, notable individuals, such as professional athletes, professional entertainers and public figures, do not qualify for the exemption. They would still have to pay tax to the state where they are appearing. Non-headline performers, including dancers and musicians, would be covered by the 30-day national standard.
The AICPA will continue to push for additional co-sponsors and for Senate consideration of S. 540.