In an article published on March 8, 2021 in Law360, Chamberlain Hrdlicka Philadelphia-based Shareholder Jennifer Karpchuk discusses how the city of Philadelphia developed various approaches on how to treat telecommuting employees for tax purposes.
“Philadelphia maintains a requirement of employment test,” explains Karpchuk. “Absent the pandemic, the city's position has historically been that a nonresident is not subject to the city's wage tax for any time spent outside of Philadelphia as required by his or her employer.”
Karpchuk further explains that nonresidents are subject to the wage tax for any time spent working outside of the city for the nonresident employee's convenience. “Applying that historical position to the COVID-19 working environment, the Philadelphia Department of Revenue asserted that any nonresident employee who was required by his or her employer to work from home because of the pandemic would not be subject to the wage tax,” said Karpchuk.
To read the full article, subscribers may click here.