It sounds like it depends upon the facts and circumstances. Please review the examples listed on Illinois Pub-130 Withholding Illinois Income Tax for My Employees.
Also review When must I withhold Illinois Income Tax from my employee's compensation? here.
When am I not required to withhold Illinois Income Tax here states:
- compensation paid to an Illinois resident whose service is performed entirely in another state, and
- the compensation is subject to withholding in another state;
is not required to withhold Illinois Income Tax.
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