Vonage Runs Afoul Of Dreaded 'Failure To Hyperlink' Regulation

Congress Trying To Stop Pointless Telecommuting Tax

from the recognizing-the-times dept

Tue, May 23rd 2006 3:39pm — Mike Masnick

Thanks to the internet and other new technologies, it's clear that telecommuting can make a lot more sense for both employers and employees these days. While it doesn't make sense in all cases, the flexibility that telecommuting allows could really help out the economy in a lot of ways. That's why it was disappointing last year when the Supreme Court refused to hear the case of a Tennessee resident who was being forced to pay New York State taxes because his employer was in New York. He was willing to pay taxes for the amount of time he actually worked in New York, but the state claimed that he wouldn't have the job if it weren't for New York, and therefore he needed to pay up. Obviously, that could lead to some very tricky situations for both telecommuting workers and the employers that hire them -- and could likely lead to having the same income subject to taxes in multiple states. It's a blatant grab for money, at the expense of encouraging telecommuting. It appears Congress is now trying to fix the situation with a proposed law that would prevent states from taxing non-residents who telecommute. It seems like a reasonable solution, but such laws have been proposed in the past and never went anywhere. Hopefully, the attention paid to last year's case will help get this bill moved forward.

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12 Comments

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Don G., 23 May 2006 @ 4:24pm

Income tax
Tennessee has an income tax. Usually, when one pays a tax such as that demanded by New York, the amount paid is deducted by the resident's home state from his tax. In this case, I suspect that New York's aggregate rate is more than Tennessee's, so Tennessee would net nothing, zero, zilch. I wonder if Tennessee was involved in this case? It clearly has an interest ...
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- Joseph Moye', 23 May 2006 @ 5:06pm
  
  Re: Income tax
  So when did TN enact an income tax?
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- Clay Stephens, 14 Jun 2006 @ 7:50am
  
  Re: Income tax
  You are incorrect. Tennessee has NO income tax. I have lived in TN my entire life, and believe me, there is no personal income tax. The "Hall" Income Tax applies only to dividends and investment interest on certain bonds, etc...
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offshoreman, 23 May 2006 @ 4:31pm

Why did we go offshore
This is just another reason every one who can is going offshore. This is insane tax policy. The NY company can easily solve the problem for the telecommuters; incoporate in Anguilla and pay employees from there.
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- J, 24 May 2006 @ 10:13am
  
  Re: Why did we go offshore
  Actually no....As long as the company has a taxable nexus to NY, then the state can and will impose a tax on them and their employees.
  
  Think about all of the companies that are incorporated in Delaware, but do business in the other states. They still have to pay taxes.
  
  Off shore incorporation is generally used to avoid US taxes on international profits.
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Joseph Moye', 23 May 2006 @ 5:05pm

So, when did TN enact an income tax?
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- David, 23 May 2006 @ 6:44pm
  
  Re: When did TN enact an income tax
  They did that in 1929...what's your point?
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  - Be an ACTIVIST, 23 May 2006 @ 7:10pm
    
    Re: Re: When did TN enact an income tax
    Tennessee does not have an "income tax" as most people know it. the Tenn Income tax that the previous poster, referenced was enacted in 29' and applies to interest from bonds and equities, and loans. not from Earned income via an occupation.
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Anonymous Coward, 23 May 2006 @ 6:13pm

That’s why we should do away with taxes and gain all income by conquering other nations... world conquest is very profitable these days.
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Ian Lee, 23 May 2006 @ 7:19pm

Let's eliminate income tax entirely
All of these questions would be so much easier and cheaper to resolve if we were to just eliminate income taxes and go to sales taxes. Jump on the wagon! Visit http://fairtax.org.
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- Scott, 24 May 2006 @ 6:16am
  
  Re: Let's eliminate income tax entirely
  How would this be fair to all the rich people buying $20 million homes and $8 million dollar boats?
  
  Have you no heart, can you not feel the plight of the Wall St. exec who only has a 60' yacht moored next to all the 80' ones?
  
  The rich and powerful will never let that happen.....
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- John W., 24 May 2006 @ 8:40am
  
  Re: Let's eliminate income tax entirely
  "all of these questions would be so much easier and cheaper to resolve if we were to just eliminate income taxes and go to sales taxes"
  
  Right on Ian!
  
  We'd no longer have to spend time filling out tax forms, we'd collect taxes on all of the illegals out there, and all of our products would become cheaper since the personal and corporate income taxes wouldn't be embedded in the cost of stuff.
  
  FairTax Thumbnail Sketch
  http://www.fairtaxvolunteer.org/smart/sketch.html
  
  FairTax FAQ's
  http://www.fairtaxvolunteer.org/smart/faq-main.html
  
  Main Site
  http://www.fairtax.org
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