# Employer tax/legal obligations for telecommuter from the EU



## jagusia (Jul 22, 2012)

What obligations (if any) does a US employer have if one of the employees telecommutes from the EU (Poland, specifically)? Provided I handle all of the Polish taxes, does the employer need to do anything?

I would especially appreciate links to sources that have this information (like IRS regulations or rules) or referral to tax people who can provide the information -- so that I can show to my employer to demonstrate that this could be done 

I know there were similar questions posted before, but they seemed more concerned with employee's taxes -- I have no questions about those, just the employer's responsibilities.

Thank you!


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## Bevdeforges (Nov 16, 2007)

Assuming the employee is physically located in Poland, then technically the "employer" would be buying services from them, not really "employing" them at all. If the telecommuter is a US citizen who had been working for the US employer in the US, it might be possible to consider the employee to be on a temporary assignment and thus subject primarily to US tax laws - but you'd have to check the Polish tax and social insurance laws on that.
Cheers,
Bev


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## robnw (Jul 18, 2012)

This is tough to get 'right' for both the company and the employee, because there are many factors. The employer will have to withhold tax on payments: will have to consider if the employee still qualifies for employee benefits and if not will need to protect themselves with agreements that will stand up in both countries; the employer will have to consider if payments to Social Security are still due - or whether they have just created a branch in Poland which requires them to pay local social security and tax deductions.
At some point, tax advisers will usually say "let's use a service company instead.'"
Here is one link
(...sorry this forum does not permit links ... search for "IRS p515.pdf" )
although I have to say that you'll need a year to study everything here and even then my experience is that American companies react like a threatened hedgehog when you mention the phrase "overseas worker". However, it's been done.


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## JasonWatson (Aug 2, 2012)

Are you a Polish citizen?

Also, the TDY angle (temporary duty assignment) is a can of worms- it cannot be indefinite and it might be less than one year in time for US tax considerations. You must be able to demonstrate that the term was less than a year from the beginning, not a lookback situation.

What are you trying to accomplish? Avoid US taxes since you are not a US citizen?

Thanks,

Jason Watson


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## expatbarrister (Aug 17, 2012)

Why be employed and not self employed? You will not be able to claim some of the benefits of being employed in the US, such as the employer paying unemployment insurance on your behalf; which is mandatory.


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