As previously reported, due to the COVID-19 pandemic, remote workforces currently dominate the landscape of most U.S. businesses. In fact, in many industries, remote workforces may be the new normal post-pandemic. Unfortunately, as workers become more mobile, the tax and human resources issues become more challenging for employers.
I was asked by Dan Feld, Principal Editor, Tax Journals, of Thomson Reuters, to author an article on this topic for the July 2022 Practical Tax Strategies Journal. With Dan’s approval, I have provided a link to the complete article, Remote Workforces: Tax Perils and Other Traps For Unwary Employers, for my blog readers.
As I indicate in the article, a multitude of issues result from mobile workforces. These issues include, but are in no way limited to, tax compliance, payment and filing obligations; employee benefits; workers’ compensation insurance coverage; unemployment insurance coverage; labor and employment laws compliance; and state and local business registration compliance. These already complex issues get even more complicated when workforces, in whole or part, morph into what is called a “hybrid remote workforce.” Employers may consciously decide to adopt a hybrid workforce model, or it may occur organically as employers work strenuously to retain employees.
Under a hybrid model, employees will work at the employer’s place of business a portion of each work period (e.g., 70 percent) and work remotely the remainder of the work period (e.g., 30 percent). If the employer’s work location and the employee’s remote work location are in the same jurisdiction, the resulting issues (with some guidance) should be easy for the employer to navigate. However, if the two locations are in different jurisdictions (even different countries), the complexity of the attendant issues multiply.
In the article, I discuss these ever-important issues. I hope you find it helpful.
Larry J. Brant
Larry J. Brant is a Shareholder and the Chair of the Tax & Benefits practice group at Foster Garvey, a law firm based out of the Pacific Northwest, with offices in Seattle, Washington; Portland, Oregon; Washington, D.C.; New York, New York, Spokane, Washington; and Beijing, China. Mr. Brant practices in the Portland office. His practice focuses on tax, tax controversy and transactions. Mr. Brant is a past Chair of the Oregon State Bar Taxation Section. He was the long-term Chair of the Oregon Tax Institute, and is currently a member of the Board of Directors of the Portland Tax Forum. Mr. Brant has served as an adjunct professor, teaching corporate taxation, at Northwestern School of Law, Lewis and Clark College. He is an Expert Contributor to Thomson Reuters Checkpoint Catalyst. Mr. Brant is a Fellow in the American College of Tax Counsel. He publishes articles on numerous income tax issues, including Taxation of S Corporations, Reasonable Compensation, Circular 230, Worker Classification, IRC § 1031 Exchanges, Choice of Entity, Entity Tax Classification, and State and Local Taxation. Mr. Brant is a frequent lecturer at local, regional and national tax and business conferences for CPAs and attorneys. He was the 2015 Recipient of the Oregon State Bar Tax Section Award of Merit.
Upcoming Speaking Engagements
- "Entity Classification – The Check-The-Box Regulations Revisited," New York University 81st Institute on Federal TaxationNew York, NY, 10.23.22-10.28.22
- "The Intersection of Code Section 1031 and Opportunity Zones," 2022 OSCPA Northwest Federal Tax Conference10.24.22
- "Entity Classification – The Check-The-Box Regulations Revisited," New York University 81st Institute on Federal TaxationSan Diego, CA, 11.13.22-11.18.22