Sample Letter (Version 1)

You can cut and paste this letter directly into the emails of your Senators and Congressional Representatives or write your own letter.

I am writing to urge you to enact The Telecommuter Tax Fairness Act of 2004 being sponsored by Senator Christopher Dodd. This important legislation would allow your constituents to work from home for employers located in other states without fear that they will owe income taxes to multiple states because they telecommute. Specifically, the legislation would prohibit states from applying a tax rule known as the 'convenience of the employer' rule, which subjects interstate telecommuters to undue taxation and threatens the growth of telework throughout the United States. The need for such legislation arises because of the U.S. Supreme Court's refusal in Zelinsky v. Tax Appeals Tribunal of New York to review New York State's policy of applying this rule.

Under the 'convenience of the employer' rule as New York applies it, non-New Yorkers who work for New York employers and choose to telecommute some or most of the time must pay New York taxes on the income they earn while working in their home states. Because a telecommuter's state of residence may also tax the income the telecommuter earns at home without providing a credit for the taxes New York imposed, the interstate teleworker risks double taxation simply because he or she teleworks. Although New York is willing to forego taxation of income earned out-of-state if the telework arrangement was an employer “necessity,” employees have little hope of persuading New York that telework was necessary. Even if the employer mandated that a worker telecommute, the state may conclude that telecommuting was not necessary if performing the work in New York would have been feasible.

The convenience rule affects telecommuters nationwide. First, New York may tax the income nonresidents earn outside New York regardless of whether the telecommuter lives close to New York and commutes often or lives across the country and works in New York only a few days a year. Second, NewYork is not the only state to have included the convenience of the employer rule in its tax policies. Third, by refusing to hear the constitutional challenges raised against the rule in the Zelinsky case, the U.S. Supreme Court effectively authorized all states to apply a similar anti-telework policy.

By deterring telework, the rule prevents businesses across the country from maximizing the bottom ine benefits telework can offer and contributing to the growth of our national economy. The economic benefits of telework for businesses include increased productivity, reduced overhead costs, and reduced recruitment and turnover costs. By discouraging telework, the convenience rule may also increase oil consumption and gasoline prices, air pollution and traffic congestion. And it contributes to wasteful government spending on transportation infrastructure. For these reasons, Congress must ban the rule.

The federal government must also dismantle the rule because it jeopardizes homeland security. As FEMA has recognized in a Federal Preparedness Circular (FPC-67 Apr. 30, 2001), telecommuting can be an essential part of an agency's continuity of operations program. If the government wants to continue functioning - and wants other employers to continue functioning - when terror is threatened or catastrophes occur, the American workforce must have the skills to telework. To acquire these skills, employees must have telework experience. If individual states assert tax authority outside their borders to discourage nonresidents from gaining telework experience, many employers will not have a workforce prepared to weather emergencies. The events of September 11, the anthrax scare, the ricin scare, the SARS epidemic, and the international power outages of summer 2003, are among the disruptions we have witnessed that underscore why a tax policy that threatens decentralized work threatens our ability to survive disasters.

The rule also obstructs the federal government's ability to comply with Public Law 106-346, which requires the government to make telework available to 100% of the eligible federal workforce. Consider an American who lives in one state and works for a federal agency located in a neighboring state. This employee is eligible to participate in the agency's telework program and wishes to do so. However, if the state where the agency is located applies a convenience rule, participating in the program may require the employee to pay income taxes on the same income to two states instead of one. The cost may be too great. The state applying the convenience rule has effectively rendered the telework program unavailable to this eligible federal worker. Thus, the state government has stymied the federal government in its effort to satisfy federal law. Legislation is necessary to check such interference.

The convenience rule also jeopardizes President Bush's objective, as set forth in his New Freedom Initiative, to facilitate the full integration of disabled individuals into mainstream American life. As the President recently highlighted in the 2004 Progress Report on this initiative, telework is crucial to empowering disabled people to join the American workforce. Similarly, the EEOC has asserted that telecommuting may be a reasonable accommodation under the Americans with Disabilities Act and that employers may be required to offer it to certain disabled workers. States should not be allowed to subject disabled nonresidents to double taxation simply because these individuals must rely on a computer, instead of a car, to get to work. States should not be permitted to fine the disabled for exercising their federal right to contribute to the American economy.

Finally, the federal government must bar states from applying the convenience rule because the rule impedes rural economic development and promotes the loss of American jobs to offshore sites. President Bush has emphasized the need to secure access to broadband technology for rural communities throughout the United States. He has supported legislation that would make broadband access permanently tax-free. A tax on interstate telecommuting is effectively a tax on the use of broadband and other communications technology for distance working. An individual state's unilateral choice to tax interstate telework violates the federal plan to maximize the growth potential telework technologies offer. It also violates the spirit of Public Law 107-171, which envisions federal support for private businesses that employ telecommuters in rural areas. Among the workers the convenience rule threatens are home-based call center agents. The bottom line benefits of 'Virtual Call Centers' are very compelling for American businesses, and their wider use would help stem the loss of jobs to offshore regions. By enacting The Telecommuter Tax Fairness Act of 2004 and barring states' application of the convenience rule, you would help preserve American jobs for American workers.

Thank you for your consideration.

Read Main article

Read other Sample Letter

Courtesy of The Telework Coalition, Enabling Virtual, Mobile, and Distributed Work through Education, Technology, and Legislation, www.telcoa.org