“Remote work is no longer the exception. It’s the new normal.”
While flexible work has opened new doors, it’s also opened a can of worms when it comes to tax compliance.
If your employees are working across state lines—or internationally—your business might face tax obligations you didn’t plan for.
At Estess CPA, we help business owners across Greater New Orleans understand and manage the tax complexities of remote teams. Here’s what you need to know.
Why Remote Workforce Taxation Should Be on Your Radar
You might be thinking:
“My employee lives in another state—what’s the big deal?”
Here’s the big deal:
Where your employee works can create tax nexus—meaning your business could be liable for income taxes, payroll taxes, and even business registration in states where your team resides.
And yes, this can happen even if your company has no physical presence there.
Every state plays by its own rules. And without proper planning, your business could face unexpected tax filings (and penalties) in multiple jurisdictions.
The Most Common Remote Workforce Tax Traps
These are the four main areas where business owners often get caught:
-
State Income Tax Withholding
You may be required to withhold income taxes for the state where the employee works—not where your business is based. -
Payroll Taxes
Employers are often responsible for payroll taxes in the employee’s work state, including unemployment insurance. -
Business Registration
Some states require you to register as a foreign entity if you have employees working from there—even remotely. -
City and Local Tax Laws
Some cities have their own tax requirements. Don’t assume state compliance covers everything.
How Remote Work Complicates Employee Tax Compliance
It’s not just your business on the line.
When your payroll system withholds taxes based on your business location—but your employee works remotely in another state—they might end up with a surprise tax bill. And a frustrated call to you.
Avoiding this? It starts with proper setup.
Multi-State Payroll: What You Should Be Doing Right Now
Here’s how we help our clients simplify the complex:
-
Track Employee Work Locations Accurately
Always know where your employees are actually working—not just where they live. -
Understand Local & State Rules
Every state has different laws. Some even require special registrations or filings for remote workers. -
Set Up Multi-State Payroll Systems
We help businesses automate payroll processes so taxes are withheld correctly, no matter the state. -
Consult Before Expanding Remote Hiring
Thinking about hiring in Texas or Florida? Call us first. We’ll walk you through the tax implications before you commit.
Remote Work Tax Laws: What’s Changing in 2025
The laws haven’t fully caught up—but enforcement is increasing. Watch out for:
-
States expanding economic nexus rules to include remote staff
-
More payroll audits for businesses with distributed teams
-
Expiration of temporary COVID-era tax leniencies
-
States cracking down on unregistered foreign entities
What worked in 2021 may not protect you today.
Why Partnering With Estess CPA Makes All the Difference
At Estess CPA, we don’t just check boxes—we help business owners stay ahead of the curve.
Whether you’re managing five in-state employees or fifty across the country, our team offers:
-
Multi-State Payroll Compliance
-
Tax Nexus Planning
-
State Registration Guidance
-
Ongoing Tax Strategy Sessions
Want to stay compliant without the guesswork?
Let’s build a plan that keeps your business protected—no matter where your team is based.
Related Reads from Estess CPA:
Ready to Simplify Your Tax Compliance?
Let Estess CPA help you stay ahead of remote workforce tax laws and keep your team—and business—on track.
📞 Belle Chasse Office: (504) 433-5122
📞 Luling Office: (985) 785-1470
🌐 Schedule a Consultation
📍 Serving Greater New Orleans with personalized accounting and tax solutions
Recent Comments