S. 386: Mobile Workforce State Income Tax and Simplification Act

By SBE Council at 19 September, 2016, 3:15 pm

The Honorable John Thune

Chairman, Committee on Commerce, Science, and Transportation

United States Senate

Washington DC, 20510

The Honorable Sherrod Brown

United States Senate

Washington, DC 20510

Dear Chairman Thune and Senator Brown:

The Small Business & Entrepreneurship Council (SBE Council) and its 100,000 members nationwide strongly support S. 386, the Mobile Workforce State Income Tax and Simplification Act of 2015.

Multi-state tax jurisdictions and payments are major issues that many small business owners, self-employed entrepreneurs, and employees have to deal with under current tax law. It is quite common for many Americans to live in one state but work, or spend many days out of the year working in another or multiple states.

When employees travel to other states to work, state tax law often treats them differently when calculating income owed. For example, individuals are subject to state income tax withholding after working 59 days in Arizona, 15 in New Mexico or 14 in Connecticut. For some states, there is a one-day requirement. Other states do not use a time requirement, but use a specific dollar figure earned while in the state. And there are other issues beyond these, which vary from state to state. This highly complex and confusing tax system is a costly burden to small businesses and employees alike.

S. 386 establishes a uniform, clear and consistent physical presence standard for nonresident income taxation, withholding, and filing requirements. The legislation eliminates confusion and complexity, and provides peace of mind and real relief to millions of Americans who operate on a mobile basis.

Thank you for your leadership on this important issue. SBE Council looks forward to working with you to advance S. 386 into law.

Sincerely,

Karen Kerrigan, President & CEO