Level 2

Telecommuting

Forum|Forum|6 years ago
March 27, 2020
8 replies
23 views

Should Illinois withhold tax from someone who lives and works from home in Pennsylvania?

The employer is located in Chicago.

This topic has been closed for replies.

sjrcpa

Level 15

Illinois is not withholding the tax. The employer is.

And no they should not if the employee performs all services in PA. Employee needs to provide proper IL exemption from withholding form to employer.

The more I know the more I don’t know.

itonewbie

Level 15

Just as Susan says.

IL is not among one of the few states that tax telecommuters who do not work remotely for the convenience of their employers.

---------------------------------------------------------------------------------Still an AllStar

C

Chris MAuthor

Level 2

Yes that is what i find confusing. Illinois is not one of the states that taxes telecommuting. However, I read that non residents are taxed if they receive Illinois source income. Source income is based on where the company is located.

itonewbie

Level 15

Are you referring to the Compensation Paid in State provision? The sounding of that provision is not exactly the same as how it's meant to be applied. That section refers to localization of service and base of operation, which should not apply to your client's case, from the limited info you shared. You may like to read up that section and the guidance in more details to clear your doubts.

---------------------------------------------------------------------------------Still an AllStar

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