Taxes, Taxes Everywhere (You Work)

If you have ever crossed a state border for work, even for a single day, you probably owe income taxes in that state.

It might sound strange, but it is nothing new. States have had such laws for decades; they just didn’t enforce them very strictly.

Except, that is, for high-profile, high-earning athletes and entertainers, whose compliance with such laws is closely scrutinized by state auditors. Such selective targets earned these types of taxes the nickname “jock taxes.”

But as I wrote in an article today, that enforcement pattern is changing. With better data-mining tools — and perhaps,  depending whom you ask, more pressure to fill state budget holes — state tax auditors are stepping up enforcement for other mobile workers.

The most vocal complainants about such laws tend to be businesses, which are tasked with withholding multiple state income taxes from their itinerant employees’ paychecks.  Here is a map, courtesy of an industry group called the Council on State Taxation, that shows the plethora of withholding requirements from each of the 50 states:

States colored in red require employers to withhold taxes from their employees’ paychecks for a work-related visit, even if the visit lasts a single day.

States colored in yellow say that some minimum threshold must be reached before employers are required to start withholding taxes. The minimum is different, however, depending on the state. And bear in mind that in some of these states,  the visiting employee still owes income taxes for a single day of travel, even if her employer doesn’t have to get involved. For example, Connecticut and New York say that visiting workers have to file taxes for a single day’s visit, but their out-of-state employers are responsible for withholding taxes from their pay only if the trip lasts at least 14 days.

Green states do not have nonresident income taxes. With the exception of Washington, D.C., all of these states actually have no state personal  income taxes at all.

This mess of (occasionally conflicting) state laws can be confusing, not to mention expensive, for companies and their employees to comply with.

That is why some big corporations have thrown their weight behind the “Mobile Workforce State Income Tax Fairness and Simplification Act.” The bill, which has been introduced twice in recent Congresses, would make state nonresident income tax laws uniform, and impose a 30-day minimum threshold before employers would be required to withhold taxes for that state.

Not surprisingly, states with shorter threshholds (or none at all) and with greater enforcement are against the bill.

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Catherine Rampell is the economics editor at nytimes.com.

David Leonhardt writes the Economic Scene column, which appears in The Times on Wednesdays.

Sewell Chan writes about economic issues from Washington D.C.

Marc Lacey is The Times's bureau chief for Mexico, Central America and the Caribbean.

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Economics doesn’t have to be complicated. It is the study of our lives "” our jobs, our homes, our families and the little decisions we face every day. Here at Economix, David Leonhardt, Catherine Rampell and other contributors will analyze the news and use economics as a framework for thinking about the world. We welcome feedback, at economix@nytimes.com.

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An accounting of the government’s rescue package.

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Faces, numbers and stories from behind the downturn.

A series about the surge in consumer debt and the lenders who made it possible.

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