Few business travelers to the U.S. are aware that under U.S. domestic tax law, if a business traveler to the U.S. spends 90 days or more cumulatively in the U.S. in a calendar year for any reason (i.e. work or leisure) or his / her income allocated to his / her work days in the U.S. is at least $3,000 (even though the person is on payroll outside the U.S.), (s)he may need to file a federal income tax return.

The employer may also need to withhold federal income taxes even though the company is a non-U.S. company outside the U.S. Each state in the U.S. also has its own rules which may differ from the federal laws. Similarly, most countries in the world have similar tax laws on business travelers with different criteria triggering income reporting, tax withholding and tax payment requirements.

Income Tax Treaties

Fortunately, many jurisdictions have income tax treaties with one another to provide exemptions to business travelers and their employers from withholding taxes, filing income tax returns and paying taxes for infrequent and occasional visits if certain specific conditions are met.