topic In state employer, out of state placement in State tax filing

In state employer, out of state placement

krave13 — Fri, 26 Feb 2021 03:38:24 GMT

I live in Florida and work on a 1099 status for a staffing agency also based in Florida. However, I do work for school districts in Illinois as a contractor through said agency. Do I need to file an Illinois tax return?

Re: In state employer, out of state placement

ErnieS0 — Fri, 26 Feb 2021 04:13:05 GMT

It depends. Were you physically present in Illinois or teleworking? If you worked in Illinois, then those days would be Illinois income.

If you worked remotely, we would need more information about your duties to clarify your situation. Illinois taxes:

earned income from any source while you were a resident,
earned income from any Illinois sources while you were not a resident, or

Illinois does not follow what is known as the “convenience of the employer” rule, which taxes teleworkers unless remote work is required by an employer. Additionally the state has only issued guidance covering out of state employers who employ Illinois residents. So your income is probably not taxable to Illinois if you work remotely. However each case is facts and circumstance based.

Re: In state employer, out of state placement

krave13 — Fri, 26 Feb 2021 14:21:45 GMT

It’s 100% remote work, all conducted from my home in FL. I have actually never lived in or even travelled to IL. I am a remote school psychologist for three districts in IL but I’m employed and paid by a staffing agency in Tampa, FL. Since the agency is in-state, I wasn’t sure if there’d be any tie back to IL, particularly on the IRS’ end, since the agency is the ‘middle man’.

Re: In state employer, out of state placement

ThomasM125 — Fri, 26 Feb 2021 21:52:36 GMT

You would not have a filing requirement in Illinois based on what you mention here. Furthermore, if you did you would normally see Illinois wages reported on your W-2 form, in boxes 15 to 20.

Re: In state employer, out of state placement

krave13 — Fri, 26 Feb 2021 22:33:28 GMT

Thanks! I don’t receive a W-2, only a 1099-NEC. But that shouldn’t change my filing obligations in this scenario, right?

@ThomasM125

Re: In state employer, out of state placement

BillM223 — Fri, 26 Feb 2021 23:57:27 GMT

No. Ernie and Thomas are correct - from what you have described, you do not need to file an Illinois return.