Non-Resident Tax Returns and Payments


When consumers employ workers who live in a state other than the state the participant lives in, "non-resident" workers state income and state unemployment taxes must be managed.  Each state has different rules and regulations for how non-resident taxes must be handled.  Some states have reciprocal agreements with other border states.  If two states have a reciprocal agreement and an individual lives in one of those states and works in the other, the individual will only be subject to the income tax in the state where he lives. All states with reciprocal agreements have provisions that exempt an workers from having the tax withheld for the state where he works, but employers are not required to withhold the tax for the state where the workers lives.

The F/EA manages non-resident tax responsibilites on behalf of any participant employers who have employees who live in a state other than the participant's state of residence.

  1. <<insert the procedure for determining an workers's state of residence.>>
  2. <<Insert the procedure for determining if an workers is non-resident.>>
  3. <<Insert the procedure for managing non-resident workers taxes.>>
Internal Controls: 
  1. <<Insert internal controls for ensuring that non-resident employees are identified.>>
  2. <<Insert internal controls for ensuring that non-resident workers taxes are appropriately filed and paid.>>