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Pretty sure I answered my questions I own a interstate

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Pretty sure I answered...

Pretty sure I answered my questions I own a interstate trucking business

Accountant's Assistant: The Expert will know how to help. Please tell me more, so we can help you best.

Interstate motor carrier employees out of state (Business Indiana). Where do I tax them?

Accountant's Assistant: Is there anything else the Expert should be aware of?

OTR motor carrier the do not work in any particular state

Submitted: 8 months ago.Category: Tax
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Answered in 33 minutes by:
9/19/2017
Tax Professional: Lane, JD, CFP, MBA, CRPS replied 8 months ago
Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 14,193
Experience: Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
Verified

In 1990, Congress passed the Amtrak Act, which made interstate truckers only liable for state and local income taxes in their home states and localities, no matter where they drove. It applies to both company drivers and owner operators.

...

But everyone (if resident in a state with income tax, pays tax to their resident state).

...

By the way, Seven U.S. states have no income tax whatsoever, and two more only tax dividends and interest, making nine states that do not tax truck driving income.

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Tax Professional: Lane, JD, CFP, MBA, CRPS replied 8 months ago

Please let me know if you have ANY questions at all, before rating me.

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Tax Professional: Tax.appeal.168, Tax Accountant replied 8 months ago
Tax.appeal.168
Tax.appeal.168, Tax Accountant
Category: Tax
Satisfied Customers: 4,637
Experience: 3+ decades of varied tax industry exp. Tax Biz owner
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Hello. Different Expert here.

While the information provided by the previous expert is correct, that interstate carriers are only liable for state and local taxes in the state where they reside, SEE BELOW:

The federal law relied upon by Taxpayer is 49 U.S.C. § 14503. That law states: (a) Single State tax withholding.-- (1) In general.--No part of the compensation paid by a motor carrier providing transportation subject to jurisdiction under subchapter I of chapter 135 or by a motor private carrier to an employee who performs regularly assigned duties in 2 or more States as such an employee with respect to a motor vehicle shall be subject to the income tax laws of any State or subdivision of that State, other than the State or subdivision thereof of the employee's residence.

REFERENCE SOURCE:

http://www.in.gov/legislative/iac/20150826-IR-045150266NRA.xml.pdf

It is important for you to know that if you are withholding pay for the employee, the business is required to file a return with the state of residence for the employee if that state imposes an income tax. SEE BELOW:

(c) Filing of information.--A motor and motor private carrier withholding pay from an employee under subsection (a) of this section shall file income tax information returns and other reports only with the State and subdivision of residence of the employee.

(SAME REFERENCE SOURCE AS ABOVE).

Let me know if the information provided clarifies matters for you. If it does, I ask that you be so kind as to scroll to the top of the page and select 3 or more stars to positively rate my response so that I can receive credit for assisting you. If you decide to positively rate my response, as two experts are involved, please be sure that you are positively rating the correct expert. Thank you in advance.

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