August 25, 2021
Nebraska temporary COVID-19 income tax withholding relief for teleworkers ended effective July 30, 2021
The Nebraska Department of Revenue updated its frequently asked questions (FAQs) to reflect that in accordance with Executive Order No. 21-09, which rescinded the state’s pandemic emergency order, it is withdrawing its temporary income tax withholding relief for teleworkers effective July 30, 2021.
As we previously reported, the Department stated that effective March 13, 2020, it would not require employers to change an employee's state as it was established before the COVID-19 emergency for Nebraska income tax withholding purposes, provided the employee was telecommuting temporarily from a work location within or outside Nebraska due to the COVID-19 emergency. (EY Tax Alert 2020-1379.)
The Department now states that beginning on July 30, 2021, employers must properly ascertain the work location of their employees for Nebraska income tax withholding purposes and meet the state’s normal withholding tax requirements (See Nebraska REG-21-001 and REG-22-001.)
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