Remote Work And State Tax Complexity: The High Cost To Interstate Educators

Remote work appears to be an apparent and growing trend. In particular, as higher education continues to expand its remote learning delivery models, the number of academic workers who provide instruction remotely also increases. In addition to the current remote faculty, 518 remote higher education positions are available (HEJ 2021) to teach the 6.9 million students enrolled in distance education courses (Ruiz & Sun, 2021). Consequently, payroll services must become well-versed in staying current in a complex tangle of state tax laws and requirements. This paper examines individual knowledge of state income tax obligations by remote interstate employees and their desire to obtain a refund of the overpayment of those taxes. Based on asynchronous interviews of 58 faculty members at a single institution, our results suggest that most do not understand state income tax regulations. Employees view taxes as unfair compared to their level of tax knowledge (Harris, 1989). The institution deducts the tax from earnings, and the employee is burdened with requesting a refund. Just as important, it can be argued that tax professionals who complete the tax returns of these employees lack knowledge and understanding of the nuances of the state income tax system as well.