Tribal income tax exemption for remote workers

[CBeamer]

Due to the recent rulings in Oklahoma, I’m a Cherokee citizen now living on a Cherokee reservation. I have 2 jobs. One is located within the Cherokee reservation. 

The other is located on the Creek reservation, of which I am not a member. But since I work from home 100% of the time does that mean all of my income is earned on the Cherokee reservation and would be exempt? 

[ErnieS0]

Oklahoma has not issued specific guidance regarding telework due to the pandemic. In general OK taxes income at the source. For example a Texas resident teleworking for an OK company is not required to pay OK income tax, so if you are a Cherokee citizen living and working on Cherokee land for a Creek employer, your income is probably exempt from state tax.

The Oklahoma Tax Commission issued a private letter ruling regarding telework in 2014 in which the Commission stated: “As a nonresident whose salaries, wages and commissions are for work performed outside of Oklahoma, and who derives no income from sources within the state of Oklahoma, it is the opinion of the Tax Policy Division that your employer is not required to deduct and withhold Oklahoma withholding tax from your wages.”

I believe the same fact pattern will be valid if you substitute “Creek” for “Oklahoma”.

See: LR-14-012 / Income Tax

[CBeamer]

Thank you for your response! My telework is not a result of the pandemic. I have always worked remotely for this position which means the work performed is actually on the Cherokee reservation for an employer on the Creek reservation.