IsabellaG
Expert Alumni

State tax filing

Up until recently, you would only be subject to state income tax for the state where you physically performed the work (where you live). Currently, only  New York, Delaware, Pennsylvania, Nebraska, and New Jersey tax nonresident remote employees that work for a company headquartered in those states. North Carolina says, " A nonresident employee is subject to N. C. withholding tax on any part of his wages paid for services performed in this State." 

 

As DoninGA stated, you will need to file a nonresident NC return to get your withholding refunded. But you should also contact your employer to make sure that for future paychecks you have PA taxes withheld instead of NC.

 

With the continued increase in remote workers, expect that states may change their rules in the future.

 

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