Withholding Taxes For Medical Professionals Crossing Borders

As many medical professionals cross state lines to enter and help critical areas hit by COVID-19, payroll professionals can’t help but ask, “are they going to be hit with unexpected state income taxes?”

U.S. Senators John Thune and Sherrod Brown created a bill to address the tax issues arising from medical professionals crossing borders to work in the busier COVID-19 areas. On June 18, 2020, Thune and Brown introduced S. 3995, the Remote and Mobile Worker Relief Act of 2020. S.3995 states that employees working in more than one taxing jurisdiction should only be subject to income tax for the area they reside in and work in for more than 30 days per calendar year.

In the earlier days of the COVID-19 pandemic, nurses and doctors were scheduled to work for two weeks in critical areas. However, as the COVID-19 pandemic evolves, many have stayed longer than two weeks to provide more assistance. In response to the extended amounts of time that medical professionals live and work in a different state, S.3995 has a section regarding adjustments for 2020 due to the COVID-19 pandemic. The “Adjustment During Coronavirus Pandemic” section states that during 2020 an employee meeting all requirements for the S.3995 Bill should replace “30 days” with “90 days”.

Recently, the American Payroll Association (APA) reached out to Senators Thune and Brown regarding the “Adjustment During Coronavirus Pandemic” section. The APA suggests that the 90-day emergency extension be amended to provide 180 days for medical professionals to assist these critical areas during the COVID-19 pandemic. The APA also recommends that the S.3995 Bill be amended to include other national emergencies in the future. While we cannot predict when another national emergency will occur, it is bound to happen. When it does, medical professionals should be able to cross borders to assist in critical areas without fearing the unexpected state income taxes that others may have seen in the past.

While navigating through 2020 and the COVID-19 pandemic is not easy, bills like S.3995 will ease the pressure on the medical professionals assisting our country. Symmetry Software would like to thank all of the doctors and nurses working on the frontlines of the COVID-19 pandemic.