For millions of Americans, a typical workday in March 2020 is unfolding quite differently than, well, at any other point in recent memory. Employees across the country are preparing for weeks and perhaps months of telework as political leaders and public health officials urge Americans to avoid large public gatherings (i.e. the dreaded work meeting). But, as the government urges workers to retreat to their at-home impromptu offices, Washington, D.C., policies penalize taxpayers for teleworking. Lawmakers can make the disease response effort considerably easier for taxpayers just in time for the (extended) tax payment deadline.
For all of the jokes on Twitter about the social isolation and stir-craziness stemming from working at home, there are real challenges associated with telecommuting. For starters, employees looking to complete their projects may have to purchase equipment that they would ordinarily take for granted at their offices. “Amenities” such as reliable internet, specialized software, technical reference materials, and virtual private networks cannot be written off from employees’ taxes if they are working from home, even though self-employed individuals can deduct these expenses from their taxable incomes. This double standard is, in fact, a recent development in tax law.
For all the economic successes created by the landmark 2017 Tax Cuts and Jobs Act, teleworking employees were negatively impacted by changes to deduction rules. In the name of closing loopholes, lawmakers decided to do away with regular employees’ access to work-from-home tax write-offs. This new limitation put teleworkers at an unqualified disadvantage to their peers who are physically at the workplace.
At the office, for instance, employees typically get through their day thanks to a steady supply of complimentary coffee and snacks such as popcorn and protein bars. Some employees of hipster chic companies such as Google and Facebook even enjoy provided lunches.
In fact, about 12% of companies offered fully or partially subsidized cafeterias in 2018. But once these hordes of employees go home, they likely won’t be able to convince their employers to pay for these routine expenses. This creates a strange inequity in the tax code, since self-employed individuals have fairly broad latitude in writing off home office expenses (including coffee and snacks consumed on the job). Moreover, the IRS has gotten quite good at flagging suspicious write-offs, reducing the chances of flagrant abuses of the tax code.
Lawmakers thought that nixing this deduction for at-home work expenses would save money, but federal policies that arbitrarily punish teleworkers may lead to less money overall in Treasury coffers. Uncle Sam permits taxpayers to deduct travel expenses to and from work from a “temporary workstation outside the metropolitan area where you live.” This could be due to a business’ principal location temporarily closing and workers getting reassigned to another office for the time being. In many of these cases, teleworking would be the more feasible solution and produce more tax revenues as a result of fewer travel deductions taken.
Even if lawmakers can’t muster up the political will to reform the tax code and spur more workers to telecommute, they can at least keep federal workers out of the office until the virus abates. Despite recent Office of Personnel Management policies encouraging telework, agencies such as the Social Security Administration have been slow to keep their employees out of harm’s way. Tony Reardon, president of the National Treasury Employees Union, says it best:
“This shouldn’t be that hard, and it is the smart and responsible thing to do. Here’s the best part, telework keeps the government running. The job still gets done. The taxpayers are well-served. With all of this talk about continuity of operations, telework, in many cases, is the best answer. Too many agencies are being far too stingy with it.”
There are, of course, important tradeoffs in allowing more workers to work from home, and employees must be briefed on accessing sensitive data through unsafe Wi-Fi networks. But the government is in a much better position to run this large-scale experiment than it was even five years ago and the risks of an increased pandemic spread far outweigh any additional cybersecurity risks.
It’s time for a national telework policy that keeps employees safe from coronavirus exposure and saves taxpayers a buck or two in the process.
Marchand is the director of policy for the Taxpayers Protection Alliance.