Overview

If you have employees that live in one state and work in another, the employee may be subject to income tax in both states. This article outlines guidelines to assist with determining withholding responsibilities specific to supported QuickBooks functionality. For example in some cases, there are reciprocal agreements between states that would require an employer to only pay income tax to one of the two states.  Consult your state agency to determine what income taxes you may be subject to.

 

For information about unemployment see QuickBooks Payroll: Multi-State Employer Unemployment Insurance Requirements.

 

Expected Outcome

You can determine your withholding responsibilities.

Assumptions

You have an active Intuit Payroll subscription and have an employee(s) set up in QuickBooks that you may need to withhold state income tax in more than one state.

Details

FAQ's and Definitions

Note: In order to determine if business nexus exists, contact your state agency.