Where should you file for unemployment if you are a telecommuter?
by Julie S
(Indiana or Arizona unemployment benefits)
I worked for a company, as a W-2 consultant, from June 2011 until the end of December 2011 when the assignment ended for the client I was working on.
The company that hired me is Head Quartered in AZ, the client is located in TX, and I worked remotely from home in IN.
I originally filed for UI benefits in IN, which was denied due to "No record of wages in my base period." I contacted the State of IN, and I was told that since the company that hired me is located in AZ, I should file for UI benefits in AZ.
I am confused, as I thought that the state you file for unemployment benefits in was the state that had state payroll taxes withheld (in my case, IN state taxes where withheld).
Did I received the correct information from IN and I should file for UI benefits in AZ?
Thank you for any information to clarify this for me.
Response To: Where should you file for unemployment if you are a telecommuter?
Hi, I changed your question because I think it might more appropriately reflect what the source of the problem.
Telecommuting presents tax issues confusion for most everyone I think, and I'm no tax specialist .. so I'm no exception.
However, since Indiana has already denied your claim, you certainly can and should file in AZ.
If your employer paid UI taxes in AZ on your wages they should show up as long as the wages are located in the base period attached to your claim for benefits.
However, I'm a little curious as to why Indiana didn't treat your claim as interstate and contact AZ to locate those wage credits.
What I know about telecommuting is it's full of opportunity for issues about benefits due to confusion about tax issues of all kinds .. including unemployment and the benefits and court rulings are unsettling to me.
New York was the state that ruled an employer didn't have to pay unemployment tax or pay benefits to an employee of a NY company that telecommuted from Florida because she wasn't physically located in NY while doing the work.
I also believe NY is the same state that ruled a telecommuting TN man had to pay NY income tax on 100 percent of income earned even though he only worked in NY physically, 25 percent of the time.
But, I've not read anything rotten about telecommuting in connection with AZ or IN .. yet.
Let me know what AZ tells you. Telecommuting issues are evolving and changing as I type.