Multistate tax
nexus, explained
plainly.

A primer on nexus — the minimum connection between a taxpayer and a state that allows the state to impose a tax — and how the rise of remote work has complicated it.

States took a hands-off approach during the pandemic, but as remote work has persisted, each state is charting its own course — from explicit exclusions to Georgia's two-scenario test.

Reciprocal agreements let workers pay income tax only in their state of residence. Only 16 states plus D.C. maintain them — and that number has not changed since November 2022.

When the office and the home are in different states, multiple states can claim the same wages. Residency, income sourcing, and the "convenience of the employer" rule each shift the outcome.

Almost overnight, COVID-19 moved 62% of U.S. work to remote. The temporary nexus relief states offered has since expired — leaving employers to navigate a fragmented post-pandemic regulatory landscape.