Income in multiple states while working remotely

[evil_shenanigans]

I work remotely as a software engineer and travel both for business and personal reasons. In 2019, I worked in several different states. The guidance I'm reading here suggests I need to pay nonresident income in each state, excepting:

• states with no income tax
• states with reciprocal agreements with my home state
• states for which my income doesn't meet a minimum threshold, if any

So far so good. But I'd still like to clarify a few points:

1. Does it matter if I worked in the state because it was a business assignment or purely for personal reasons? In most cases, the state I was physically located had nothing to do with the work itself; i.e., I didn't go into an office or anything, basically just used some electricity and internet access.
2. Does it matter if I'm a W-2 employee or 1099-MISC self-employed contractor? (This changed during the year.)
3. Most state revenue service websites specify that I pay taxes on income "from Colorado sources" (for example) or some similar phrase. If I'm working remotely while temporarily in Colorado (say, for a few weeks), is that income from Colorado sources? The idea of what state is sourcing my income is a little unclear to me since none of my employers are actually located in my resident state either. (Again, I'm not specifically interested in Colorado, but more generally for any state.)
4. Are there any other circumstances under which I don't owe tax to some of these states? Obviously, the fewer state returns I have to file the better.

[rjs]

"Does it matter if I worked in the state because it was a business assignment or purely for personal reasons?"

In some states, yes. In some states, no.

"Does it matter if I'm a W-2 employee or 1099-MISC self-employed contractor?"

In some states, yes. In some states, no.

"The idea of what state is sourcing my income is a little unclear to me"

Income is always sourced to the state where you did the work, even if the employer or client is in a different state, and generally regardless of why you did the work in that particular state. However, depending on the reason you are working in a different state, some states will assert that the income is sourced to the state where the employer is located. So you can end up with two states claiming to be the source of the same income.

"Are there any other circumstances under which I don't owe tax to some of these states?"

I'm not sure, but I don't think so.

Your situation might also be affected by the Covid-19 pandemic. Some states are making exceptions to the usual rules for people who are working remotely in a different state because of the pandemic. The situation is very fluid, and may change as more states make decisions.

You have a very complicated situation. I recommend that you consult a tax professional who specializes in multiple-state filing. I don't think this is a do-it-yourself situation.