SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Mobile Workforce 
State Income Tax Simplification Act of 2012’’. 
SEC. 2. LIMITATIONS ON STATE WITHHOLDING AND TAX-
ATION OF EMPLOYEE INCOME. 
(a) IN GENERAL.—No part of the wages or other re-
muneration earned by an employee who performs employ-
ment duties in more than one State shall be subject to 
income tax in any State other than— 
(1) the State of the employee’s residence; and 
(2) the State within which the employee is 
present and performing employment duties for more 
than 30 days during the calendar year in which the 
wages or other remuneration is earned. 
(b) WAGES OR OTHER REMUNERATION.—Wages or 
other remuneration earned in any calendar year shall not 
be subject to State income tax withholding and reporting 
requirements unless the employee is subject to income tax 
in such State under subsection (a). Income tax with-
holding and reporting requirements under subsection 
(a)(2) shall apply to wages or other remuneration earned 
as of the commencement date of employment duties in the 
State during the calendar year. 
(c) OPERATING RULES.—For purposes of deter-
mining penalties related to an employer’s State income tax 
withholding and reporting requirements—
(1) an employer may rely on an employee’s an-
nual determination of the time expected to be spent 
by such employee in the States in which the em-
ployee will perform duties absent— 
(A) the employer’s actual knowledge of 
fraud by the employee in making the determina-
tion; or 
(B) collusion between the employer and the 
employee to evade tax; 
(2) except as provided in paragraph (3), if 
records are maintained by an employer in the reg-
ular course of business that record the location of an 
employee, such records shall not preclude an employ-
er’s ability to rely on an employee’s determination 
under paragraph (1); and 
(3) notwithstanding paragraph (2), if an em-
ployer, at its sole discretion, maintains a time and 
attendance system that tracks where the employee 
performs duties on a daily basis, data from the time 
and attendance system shall be used instead of the 
employee’s determination under paragraph (1). 
(d) DEFINITIONS AND SPECIAL RULES.—For pur-
poses of this Act: 
(1) DAY.—
(A) Except as provided in subparagraph 
(B), an employee is considered present and per-
forming employment duties within a State for a 
day if the employee performs more of the em-
ployee’s employment duties within such State 
than in any other State during a day. 
(B) If an employee performs employment 
duties in a resident State and in only one non-
resident State during one day, such employee 
shall be considered to have performed more of 
the employee’s employment duties in the non-
resident State than in the resident State for 
such day. 
(C) For purposes of this paragraph, the 
portion of the day during which the employee is 
in transit shall not be considered in determining 
the location of an employee’s performance of 
employment duties. 
(2) EMPLOYEE.—The term ‘‘employee’’ has the 
same meaning given to it by the State in which the 
employment duties are performed, except that the 
term ‘‘employee’’ shall not include a professional 
athlete, professional entertainer, or certain public 
figures.
(3) PROFESSIONAL ATHLETE.—The term ‘‘pro-
fessional athlete’’ means a person who performs 
services in a professional athletic event, provided 
that the wages or other remuneration are paid to 
such person for performing services in his or her ca-
pacity as a professional athlete. 
(4) PROFESSIONAL ENTERTAINER.—The term 
‘‘professional entertainer’’ means a person who per-
forms services in the professional performing arts 
for wages or other remuneration on a per-event 
basis, provided that the wages or other remuneration 
are paid to such person for performing services in 
his or her capacity as a professional entertainer. 
(5) CERTAIN
PUBLIC
FIGURES.—The term 
‘‘certain public figures’’ means persons of promi-
nence who perform services for wages or other remu-
neration on a per-event basis, provided that the 
wages or other remuneration are paid to such person 
for services provided at a discrete event, in the na-
ture of a speech, public appearance, or similar event. 
(6) EMPLOYER.—The term ‘‘employer’’ has the 
meaning given such term in section 3401(d) of the 
Internal Revenue Code of 1986 (26 U.S.C. 3401(d)), 
unless such term is defined by the State in which
the employee’s employment duties are performed, in 
which case the State’s definition shall prevail. 
(7) STATE.—The term ‘‘State’’ means any of 
the several States. 
(8) TIME
AND
ATTENDANCE
SYSTEM.—The 
term ‘‘time and attendance system’’ means a system 
in which— 
(A) the employee is required on a contem-
poraneous basis to record his work location for 
every day worked outside of the State in which 
the employee’s employment duties are primarily 
performed; and 
(B) the system is designed to allow the em-
ployer to allocate the employee’s wages for in-
come tax purposes among all States in which 
the employee performs employment duties for 
such employer. 
(9) WAGES OR OTHER REMUNERATION.—The 
term ‘‘wages or other remuneration’’ may be limited 
by the State in which the employment duties are 
performed. 
SEC. 3. EFFECTIVE DATE; APPLICABILITY. 
(a) EFFECTIVE DATE.—This Act shall take effect on 
January 1 of the 2d year that begins after the date of 
the enactment of this Act.
(b) APPLICABILITY.—This Act shall not apply to any 
tax obligation that accrues before the effective date of this 
Act. 
Passed the House of Representatives May 15, 2012. 
Attest: 
Clerk.
112TH CONGRESS 
2D SESSION 
H. R. 1864 
AN ACT 
To limit the authority of States to tax certain in-
come of employees for employment duties per-
formed in other States.