One of my employees has moved to California. Our business is based in Massachusetts. When I went to change his place of work to “remote”, our payroll provider told me I had to get an employer nexus in CA and pay an $800/year tax. Further in the discussion, the rep suggested as a workaround, I could hire him in Massachusetts instead, make his Massachusetts state withholding $0, and have him pay estimated state taxes to the state of California on his own, primarily because not all states have determined how things will be handled with so many workers going remote.
How kosher of an idea is this? Would the worst case scenario be that California would ask us to back-register and pay the $800? Will Massachusetts wonder why his withholding is $0 in our payroll? Given that he may not work from CA long term, I’d love to avoid the expense if I can short term.
How kosher of an idea is this? Would the worst case scenario be that California would ask us to back-register and pay the $800? Will Massachusetts wonder why his withholding is $0 in our payroll? Given that he may not work from CA long term, I’d love to avoid the expense if I can short term.
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