The state CPA societies joined forces with the American Institute of CPAs (AICPA) and sent more than 400 letters to their U.S. Senators and Representatives this month urging lawmakers to support including the Mobile Workforce State Income Tax Simplification Act of 2017, H.R. 1393, in the omnibus spending package.
While H.R. 1393 passed the House last June and S. 540, the Senate companion bill, has 60 bipartisan co-sponsors, the legislation is unlikely to be considered as a standalone bill in the Senate. Therefore, it needs to be attached to a larger legislative vehicle. Because the omnibus spending bill is a “must pass” bill, in that it provides funding for the federal government through the end of the fiscal year, it would have been a good vehicle for the mobile workforce bill.
H.R. 1393 and S. 540 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 H.R. 1393 and S. 540 notable individuals, such as professional athletes, professional entertainers and public figures, do not qualify for the 30-day de minimis 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 now look for other adoption avenues.