§ 15-30-2513 — Withholding From Compensation -- Exception

15-30-2513 . Withholding from compensation -- exception. (1) No amount is required to be deducted or retained from compensation paid to a nonresident for employment duties performed in this state if the compensation is excluded from Montana source income pursuant to 15-30-2106 , without regard to 15-30-2106 (1)(a). The number of days a nonresident employee is present in this state for purposes of 15-30-2106 (1)(b) includes all days the nonresident employee is present and performing employment duties in this state on behalf of the employer or any subsidiary, division, agent, or contractor of the employer.
(2) An employer that has erroneously applied the exception provided by this section solely as a result of miscalculating the number of days a nonresident employee is present in this state to perform employment duties is not subject to penalties imposed under 15-30-2503 and 15-30-2509 if:
(a) the employer relied on a regularly maintained time and attendance system that:
(i) requires the employee to record, on a contemporaneous basis, the employee's work location each day the employee is present in a state other than:
(A) the state of residence; or
(B) where services are considered performed for purposes of unemployment insurance benefits, as provided in Title 39, chapter 51; and
(ii) is used by the employer to allocate the employee's wages between all taxing jurisdictions where the employee performs duties;
(b) the employer does not maintain a time and attendance system described in subsection (2)(a) and relied on employee travel records that the employer requires the employee to maintain and record on a regular and contemporaneous basis; or
(c) the employer does not maintain a time and attendance system described in subsection (2)(a), or require the maintenance of employee records described in subsection (2)(b), and relied on travel expense reimbursement records that the employer requires the employee to submit on a regular and contemporaneous basis.
(3) This section establishes an exception to withholding and deduction requirements and has no application to the imposition of this state's jurisdiction to impose a tax under this chapter or any other tax on any taxpayer.

Legislative History

En. Sec. 2, Ch. 563, L. 2023.