GTN Mobility Tax Blog

Now that the intensity of another US tax season has passed, it’s an opportune time to reflect on your mobility program with a post-tax season check-up. Taking time now to review this past tax season will allow you and your mobility tax provider to discover ways to enhance the employee experience, highlight areas of risk and outline necessary actions, and understand any frustrations that occurred so you can strategize future improvements. To guide you through this review, we’ve created a checklist that includes key considerations and tips for a successful post-tax season review.

The US is one of the only countries to require its citizens and permanent residents (i.e., green card holders) to file annual tax returns and report their worldwide income, regardless of their actual work location. When working outside the United States, it is often the case that US persons are subject to taxation in the county where they are physically located.

The modern workforce is a mobile one and has expanded beyond the traditional short- or long-term assignment. Today, mobility includes a variety of work arrangements such as remote and hybrid work, as well as short-term business travel. This shift has provided greater flexibility in how and where employees work, allowing organizations to access a wider talent pool and operate more efficiently across different locations. However, with increased flexibility comes the challenge of navigating complex reporting and filing requirements to avoid financial, legal, and reputational risks.

The global mobility landscape is continuously evolving, often bringing significant changes that directly impact businesses, mobile employees, and the broader mobility industry. In our recent webinar, we explored key legislative, economic, and policy developments that could shape mobility programs in the months ahead. With new regulations taking effect and additional proposals on the horizon, staying informed is crucial for strategic planning. 

All US citizens and permanent residents must file federal income tax returns if they meet the Internal Revenue Service (IRS) filing threshold. The size of this threshold will vary depending on factors such as age, filing status, and type of income (e.g., income from employment or self-employment). For example, a single individual under the age of 65 would be required to file a 2024 US federal income tax return if their gross income exceeded $14,600. If the earnings came from self-employment, this same person would need to file a US federal tax return if their net earnings exceeded $400.

In today’s technological world, it is easier than ever for businesses to participate in the global economy through the use of business travelers, international assignments, remote workers, or one-way transfers. However, international tax compliance for cross-border employees can present unexpected challenges for both the employee and the company. Even a single day of work in a foreign location can trigger complex tax filings for the individual, as well as tax reporting and withholding obligations for the company in the Home and Host countries. Failing to comply with these obligations can have serious consequences, such as unexpected tax bills, increased audit costs, financial penalties, and legal and reputational risks for the company and the employee.