With what seems like everybody working from home—for what seems like the last decade—you would be well within your rights to question the tax implications for employees this year. While logic would dictate that taxes would skew to the lower side due to fewer commuters overall, several states have different plans for their at-home workers.
Even though you’re probably working from home, the office in which you work still has bills and costs associated with it. That same statement goes for the public transportation system you might use to reach that office, the roads on which you would travel, and other public amenities that support a commuter model and the basic infrastructure on which we depended pre-COVID.
As such, you may need to anticipate some related taxes this year.
Primarily, many states plan to tax workers based on their employment location, not their residential address. For some, this may not make much of a difference (I live less than a mile from my place of work); however, anyone hoping to avoid a city-based tax by working at home in the suburbs is in for a rude awakening.
This isn’t actually a new concept. The process, known as “convenience of the employer”, relies on the understanding that these large, city-based businesses need the support that taxes offer, and anyone responsible for working in those locations is also responsible for maintaining them in that context.
If you think that sounds contrived, buckle up—some states are also looking into a 5% tax for public transportation. Since public transit options aren’t getting the same level of use that they were pre-pandemic, they aren’t receiving the level of TLC needed to maintain them; this carries serious implications for the safety and convenience of those public transportation options once lockdown ends.
As mentioned previously, the roads which public transportation uses and things like lighting, demarcation, and sidewalks also need upkeep—something they aren’t receiving with the same level of funding they did prior to last March. The same can be said of highways and the like.
It’s easy for people making these recommendations to justify them; if you’re still employed and you haven’t had to take a pay cut at all, your expenses have probably decreased. However, this is clearly a time in which people need to save every penny possible—something for which these tax proposals clearly don’t account.