David, Brody & Dondershine, LLP Experienced General Business Law Attorneys
2100 Reston Parkway, Suite 370
Reston, VA 20191

Company travel across state lines: some relevant considerations

Seasoned travelers in the Washington, D.C., metro area and across the rest of the country who have crossed state lines for years while conducting business operations on behalf of their employers likely remember a time when they didn't give much regard -- if any -- to the tax consequences entailed in that.

As noted in a recent Accounting today article, that time has passed.

And here's why: The great majority of states collect taxes on income, and revenues linked with business activity inside their borders comprise ripe pickings that augment their treasuries.

That means something both immediate and important for businesses of a size and complexity warranting interstate company travel in pursuit of profits. They must be aware of the tax regimes in every state where they conduct business, and they must duly comply with tax regulations within those jurisdictions.

The word that Accounting Today centrally uses to describe that duty is "complex," given that there is "considerable variation" among the states in their requirements for withholding and reporting in-state business income.

Companies with interstate connections have myriad and strong reasons for implementing internal programs that help them track employee travel and correlating that travel with the tax duties imposed in every state where business is conducted.

Obviously, being found wanting by any state's tax authorities can yield an adversely expensive result. Tax outlays will be demanded, with, likely, additional penalties also being levied for noncompliance. Moreover, no business wants to take a public-relations hit for any linkage with unlawful tax avoidance.

The bottom line for any business conducting operations on an interstate basis is that tax-related regulatory compliance is a flat imperative. Tax-focused issues and other business risks and challenges can be addressed to experienced attorneys at a proven business and commercial law firm.

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