Cities the Next Front in Work-From-Home Tax Rule Disputes

The coronavirus pandemic has threatened cities economically, hammering revenue-generating restaurants, sport venues, and entertainment sites for months because of government lockdowns and company mandates that employees work from home.

Municipalities with city wage taxes have taken an even bigger hit as they’ve watched their revenue bases decline. Some are issuing guidance to clarify that workers—many of whom haven’t worked from their employer’s location since the spring—owe taxes sourced to the workplace.

That stance could land municipalities in legal hot water just as it has sparked litigation between Massachusetts and New Hampshire, practitioners told Bloomberg Tax. ...