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Rhode Island: Duration of Emergency Withholding Rules for Pandemic-Related Telecommuting Revised

Regulation 280-RICR-20-55-14 “Withholding for Employees Working Remotely During the COVID-19 State of Emergency,” R.I. Div. of Tax. (7/21). The Rhode Island Division of Taxation (Division) revised the duration of its emergency regulation that first came into effect on May 23, 2020, and which provides tax withholding guidance for employers that have employees who are temporarily working remotely due to the COVID-19 pandemic, through to September 13, 2021 rather than September 15, 2021 (note that, originally, this emergency regulation was scheduled to expire on November 18, 2020, then subsequently was extended through to January 18, 2021, then March 19, 2021, then May 18, 2021, and then July 17, 2021). According to the Division’s corresponding advisory guidance [see Advisory 2020-22 (5/26/20)], this emergency regulation “temporarily simplifies the tax withholding process with regard to remote working.” Under the emergency regulation, the income of employees who are nonresidents temporarily working outside of Rhode Island solely due to the pandemic generally will continue to be treated as Rhode Island-source income for Rhode Island withholding tax purposes. Additionally, under the emergency regulation, Rhode Island generally will not require employers located outside of Rhode Island to withhold Rhode Island income taxes from the wages of employees who are Rhode Island residents temporarily working within Rhode Island solely due to the COVID-19 pandemic. Please contact us with any questions.