Telecommuting has grown exponentially in the last few years. The number of employees working remotely at least one day per week rose 74 percent from 2005 to 2008,1 with 20 million to 30 million doing so in 2008. Recently the U.S. Senate unanimously passed the 2010 Telework Enhancement Act to expand telecommuting opportunities for federal employees.2 A white paper issued collaboratively by the U.S. General Services Administration and the Telework Exchange, a public-private partnership, set out some of the benefits of telecommuting....

...No good deed goes unpunished. An employer that allows its employees to telecommute and perform work in a state in which it does not already have nexus — that is, does not have a sufficient connection with that state to allow the state to assert tax jurisdiction under the U.S. Constitution — could find itself subject to income tax and responsible for the collection of sales tax (to name just a couple of the potential tax obligations a state could assert) in the state from which the employee telecommutes....