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Rakhi Vasavada
Rakhi Vasavada, Financial and Legal Consultant
Category: Finance
Satisfied Customers: 2602
Experience:  Graduated in law with Emphasis on Finance and have have been working in financial sector for over 12 Years
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I work University located in Georgia that employees adjunct

Customer Question

I work for a University located in Georgia that employees adjunct instructors to teach online courses. Many of the Adjuncts live in states other than Georgia. Other than the fact that the adjunct employees live in those states, we have no physical presence there. Do we have to withhold state income taxes from the adjuncts and remit them to the states they reside in?
Submitted: 1 year ago.
Category: Finance
Expert:  Shawn P Adamo replied 1 year ago.
Employers in states with an income tax have state (and sometimes local) payroll tax withholding, payment and reporting obligations. Multistate employment withholding may be governed by reciprocal agreements between states. In addition, several states have mandated disability programs which impose payroll tax responsibilities on employers.
Expert:  Shawn P Adamo replied 1 year ago.
In addition to your numerous employer federal payroll tax responsibilities for your employees, if you do business in a state that imposes a personal income tax, you can add the requirement of withholding state taxes from employees' wages to your payroll tax responsibilities.The majority of states impose a personal income tax. The states that do not impose a personal income tax are:AlaskaFloridaNevadaNew Hampshire*South DakotaTennessee*TexasWashingtonWyoming(* New Hampshire and Tennessee do impose a tax, but on dividend and interest income only.)Every other state has a personal income tax which therefore requires employers to withhold the tax from employees' wages.How do you fulfill your state payroll tax responsibilities? Most states allow employers to use methods that are similar to those used for federal tax purposes in determining their state income tax withholding amounts
Expert:  Shawn P Adamo replied 1 year ago.
In some states there are cities, counties, and other local governmental units that impose their own income tax. If you do business in one of these localities, you may very well have an additional income tax withholding obligation. In addition to local income taxes, you may also find yourself paying local taxes measured by your total payroll (payroll expense taxes) or withholding local occupational fees from your employees' wages.Consult our income tax withholding obligations by state map to learn about your state's requirements for employers.
Expert:  Shawn P Adamo replied 1 year ago.
Let's assume you have a Utah office where you employ six Utah residents. You also have a second office in New Mexico, where you employ three New Mexico residents. Your employees never leave their state of residence to work in the other, out-of-state office. You would have to withhold Utah income taxes from the wages of your six Utah employees and New Mexico income taxes from the wages of your three New Mexico employees. You would have separate withholding obligations in each state.
Expert:  Shawn P Adamo replied 1 year ago.
Some States Have Reciprocal agreements Usually under these types of agreements, state A agrees that it won't require state A employers to withhold its income tax from wages paid to residents of state B, and state B reciprocally agrees that it won't require state B employers to withhold its income tax from wages paid to residents of state A. So, if you do hire employees who are residents of other states, a good first step is to confirm whether your state has any reciprocal agreements in effect with those other states and, if so, whether the agreement relieves you of any withholding obligations. Our state income tax map includes information about the reciprocal agreements in force in each state.
Expert:  Shawn P Adamo replied 1 year ago.
I realize there is a lot to consider. Perhaps a call will help. I'll send an offer. It should be MUCH easier.