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EXPAND YOUR HORIZONSMake the Right Connections
Everything You Wanted to Know About Short-Term Domestic Assignments
Today’s Presenters:• Craig Anderson, C.E. Anderson & Company
• Kevin Shimkus, Deloitte
• Dawn Higgins, Nestle Purina PetCare Product Technology Center
TEMPORARY DOMESTIC ASSIGNMENTS
Short Term
Assignments
• Generally – assignments of less than one year, then the employee returns home.
Long Term Assignments
• A less than permanent, shorter duration relocation in which the employee returns back home upon completion of the assignment.
SHORT TERM ASSIGNMENTS
• What they are?
• When are they used?
• How will usage volumes change?
• Why doesn’t everyone use them?
FORMAL POLICIES
ASSIGNMENT PURPOSES
PROJECTED USAGE
ASSIGNMENT CHALLENGES
EXPAND YOUR HORIZONSMake the Right Connections
Domestic Travelers : Setting the Stage
• Short term business travelers
• Frequent business travelers
• Short term assignment
• Long term assignment
• Relocation
Tax Considerations
• Federal– Tax home– Taxation of travel expenses and per diems
• State & Local– Withholding– Different definition of “wages”– Deferred compensation– Tax resident
Tax Home
• Rev. Rule 60-189
• Traveler must be “away from home” for travel expense to be excluded from income
• Principal place of business
• “Tax turtle”
Amount of Time Away From Home
• Rev. Rule 93-86
• Taxpayer has relocated “tax home” when they have exceeded 12 months in a location or when there is an expectation for them to exceed 12 months in that location.
California Connecticut
Very aggressive regarding non-resident wage withholding and tax remittances
No De Minimis threshold
De Minimis threshold14 days
Illinois New York
No De Minimis threshold
De Minimis threshold14 days
December 2, 2009 CT issued Announcement 2009(9) requiring employer wage reporting and tax withholding for non-residents working 14 or more days in CT throughout the year
Has quite ‘favorable’ non-resident guidelines — Especially if company is not located anywhere in IL
Uses an informal calendar year de minimis threshold for state tax withholding for a non-resident working in New York as reported in its state Field Audit Guidelines issued July 1, 2004
Short Term Business Travelers: State to State
State Tax Issues
• Different definitions of “wages”– Health savings accounts– Domestic partner benefits
• Not all states accept Federal W-4
• Deferred compensation & equity compensation
Local Tax Issues
• Local income tax withholding
• Local employer taxes
EXPAND YOUR HORIZONSMake the Right Connections
Nestlé Purina PetCare
Our Mission
To bring several employees (40+) to the St. Louis Headquarters Office to work on our
SAP implementation project.
Nestlé Purina PetCareHow to we plan for this?How to we plan for this?
Do we have a policy?Do we have a policy?
What’s our current policy?What’s our current policy?
Who needs to help me?Who needs to help me?
Nestlé Purina PetCareHow to Plan:
• Identify plans / practices already in place• Gather your resources
• Partner with Management (HR, Business, Factory)
• Partner with Legal• Partner with Relocation Provider• Partner with Finance / Tax / Audit• Partner with Service Providers - Corporate Housing,
Rental Car Company
Nestlé Purina PetCareDevelop our Policy:
• Expanded on plans / practices in place• Partnered with key resources• Communicated the policy and the process
• Face-to-Face meetings• Email
• Offered project incentives• HR Manager managed and owned the process
Nestlé Purina PetCarePolicy Benefits Offered:
• En route expenses• Return trips home every week or month• Housing accommodations (pet friendly furnished corporate
apartment or extended stay hotel)• Rental car or mileage reimbursement for personal car• Per diems • Miscellaneous expenses allowance (start and end of assignment)• Tax preparation and tax equalization assistance• Family accompaniment (special circumstances)
Nestlé Purina PetCare
Challenges:• Tax compliance and expense tracking• Family and personal issues• Communication of policy changes• From an HR perspective – keeping employees
engaged, morale
Nestlé Purina PetCare
Lessons Learned:• Over communicate
• Policy updates, changes, etc.• Involve partners early and often• Evaluate the policy, program
EXPAND YOUR HORIZONSMake the Right Connections
POLICY BENEFITS FOR TEMPORARY DOMESTIC
ASSIGNMENTS
DOMESTIC RELOCATION POLICY RESEARCH
TEMPORARY DOMESTIC ASSIGNMENTSTrippel Survey & Research, LLC
© January, 2012 (Used with permission)
No part of this work may be reproduced
Copies of the report may be purchased by contacting
Trippel Survey & Research, LLC at 501 922-4000
Thank You for Attending!
Questions?
