Session of 2023
HOUSE BILL No. 2420
By Committee on Taxation
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AN ACT concerning income taxation; relating to withholding taxes;
establishing withholding requirements for certain employees who work
in multiple states.
Be it enacted by the Legislature of the State of Kansas:
Section 1. (a) As used in this section:
(1) "Certain public figures" means persons of prominence who
perform services for wages or other remuneration 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 nature of a speech, public
appearance or similar event.
(2) "Employee" means the same as defined in K.S.A. 79-3295, and
amendments thereto, except that the term ''employee'' does not include a
professional athlete, professional entertainer, qualified production
employee or certain public figures.
(3) "Employer" means the same as defined in K.S.A. 79-3295, and
amendments thereto.
(4) "Professional 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 the person's capacity as
a professional athlete.
(5) "Professional entertainer" means a person of prominence who
performs 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 the
person's capacity as a professional entertainer.
(6) "Qualified production employee" means a person who performs
production services of any nature directly in connection with a qualified,
certified or approved film, television or other commercial video
production for wages or other remuneration, provided that the wages or
other remuneration paid to such person are qualified production costs or
expenditures under such qualified, certified or approved film incentive
program and that such wages or other remuneration must be subject to
withholding under such film incentive program as a condition to treating
such wages or other remuneration as a qualified production cost or
expenditure.
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(7) "Time and attendance system" means a system in which:
(A) The employee is required on a contemporaneous basis to record
such employee's 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 employer to allocate the
employee's wages or other remuneration for income tax purposes among
all states in which the employee performs employment duties for such
employer.
(8) "Wages or other remuneration" includes wages and payment other
than wages as such terms are defined in K.S.A. 79-3295, and amendments
thereto.
(b) (1) No part of the wages or other remuneration earned by the
employee who performs employment duties in more than one state shall be
subject to income tax in any state other than:
(A) The state of the employee's residence; or
(B) the state that the employee is present and performing employment
duties for more than 30 days during the calendar year that the wages or
other remuneration is earned and the nonresident employee's state of
residence:
(i) Provides a substantially similar exclusion; or
(ii) does not impose an individual income tax.
(2) No part of the wages or other remuneration earned by the
employee shall include income that is exempt from taxation by the state of
Kansas pursuant to the United States constitution or other federal law.
(c) Wages or other remuneration earned in any calendar year shall not
be subject to Kansas income tax withholding and reporting requirements
unless the employee is subject to income tax in Kansas pursuant to
subsection (b). Income tax withholding and reporting requirements under
subsection (b)(2) shall apply to wages or other remuneration earned as of
the commencement date of employment duties in the state during the
calendar year.
(d) Except as provided in subsection (b), an employee is considered
present and performing employment duties within a state for a day if the
employee performs more of the employee's employment duties within such
state than in any other state during a day.
(e) If an employee performs employment duties in Kansas and in only
one nonresident state during one day, such employee shall be considered to
have performed more of the employee's employment duties in the
nonresident state than in Kansas on such day.
(f) For purposes of this section, 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.
(g) For purposes of determining penalties related to an employer's
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income tax withholding and reporting requirements:
(1) An employer may rely on an employee's annual determination of
the time expected to be spent by such employee in the states in which the
employee will perform duties absent:
(A) The employer's actual knowledge of fraud by the employee in
making the determination; or
(B) collusion between the employer and the employee to evade the
tax;
(2) except as provided in paragraph (3), if records are maintained by
an employer in the regular course of business that record the location of an
employee, such records shall not preclude an employer's ability to rely on
an employee's determination under paragraph (1); and
(3) notwithstanding paragraph (2), if an employer, 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).
(h) This section shall be a part of and supplemental to the Kansas
withholding and declaration of estimated tax act.
Sec. 2. This act shall take effect and be in force from and after its
publication in the statute book.
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