Many employees continue to telecommute due to the COVID-19 outbreak. As discussed in our previous blog post on state tax nexus and apportionment issues, out-of-state employers may need to consider whether a telecommuting employee’s activities could create nexus, exceed Public Law 86-272 protections, or impact the employer’s state income tax apportionment factor (particularly in states with a payroll factor or a sales factor where receipts are sourced based on cost of performance).
Riot Games, Inc. (“Riot”) is the developer and publisher of League of Legends (“LoL”), a popular multiplayer online battle arena game.[1] In LoL, two teams of five players each battle to destroy each other’s Nexus, or base. Players control characters that have various different attacks and abilities. Each team also has minions that stream towards the other team’s base, and each team attempts to protect their base by attacking other characters and pushing their own minions forward and stopping the other team’s minions from advancing. In 2018, Riot had a version of the game called Nexus Blitz. Although Riot hasn’t brought back Nexus Blitz since 2018, it has had to deal with another nexus attack from Washington State.
Many employees are now telecommuting due to the COVID-19 outbreak. In our previous blog post, we discussed employers’ potential withholding issues as a result of employees working remotely. In this blog post, we will discuss potential nexus and apportionment issues due to employees working remotely.
The Baker McKenzie State and Local Tax (SALT) Subpractice Group is presenting a series of short webinars to keep members of the SALT community abreast of recent developments in these less than certain times. We hope you will attend so we can stay connected as we address these issues together. The next session in the series, State of Nexus, will take place on Wednesday, April 8 at 1:00 pm ET. If you would like to…