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Entergy Employees Working Remotely May Run into These Tax Hurdles

Tax withholding and filing status should be updated for Entergy employees moving to remote work to avoid surprise liabilities, says Brent Wolf, of The Retirement Group, a division of Wealth Enhancement Group.

With remote work continuing to reshape the workforce, Entergy employees need to be aware of their tax obligations across states and having a tax advisor can help with that, says Kevin Landis, of the Retirement Group, a division of Wealth Enhancement Group.

What is it that we will discuss here:

Tax consequences of working from home including withholding and filing returns in several states.
Deductions for remote workers affected by the Tax Cuts and Jobs Act.
Considerations for employers with remote workers across states.

This COVID-19 pandemic also forced businesses into remote work and amplified a trend that was already taking place. Even before the pandemic, more Americans worked from home. From 2005 to 2019, more than 216% of all companies worldwide work remotely (GlobalWorkplaceAnalytics.com, 2021). But with millions starting to return to work, telecommuting part-or full-time is becoming standard (McKinsey and Company, 2022). But working from home has its benefits - less commuting and more flexible schedule - but it comes with tax responsibilities. Entergy employees should know about these changes in the workforce and prepare accordingly.

These four tax considerations apply whether you work from home or contract out remote workers for a company like Entergy:

Withholding Tax from Wages Remote working has helped many people relocate to new states in metropolitan areas and smaller cities. This mobility can cause withholding errors if you fail to notify your payroll department of your new home address. And remember that workers must have taxes withheld based on the state's tax rules wherever their employer is located. Not updating your withholding information could mean an unexpected Tax bill or underpayment penalties come Tax Day.

Some states also require that employers withhold taxes from nonresident employees' wages. For example, New York requires employers to withhold state income tax from nonresidents' wages.

Filing Returns in More than One State. In two or more states you may have to file a tax return for each state you work in. It's because many states require nonresident employees to pay state income taxes if they earned money in that state, wherever they lived. A few states even require a tax return if you worked anywhere within their borders - even on a business trip.

Note also that residents or workers of any of the nine U.S. states that do not collect income tax - Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming - will not be required to report their income to that state.

Deducting Business Expenses, The Tax Cuts and Jobs Act of 2017 eliminated several miscellaneous Tax deductions, including unreimbursed business expenses, through 2025. Therefore, expenses you incur while working from home that are not reimbursed by your employer cannot be deductible on your taxes. In past tax law, workers could deduct some out-of-pocket work-related expenses greater than 2% of adjusted gross income. But that deduction will return in 2026.

In contrast, if you are self-employed, you can still deduct many business expenses on Schedule C of your Form 1040.

We Have Workers in Several States. You own a business in one state but have a remote employee in another state - you may need to register your business in that employee's home state. It involves estimated taxes, tax returns, and other reporting to the state. If this is you, consult a tax professional who knows state and federal tax laws.

To summarize - taxes are complicated - and the trend toward remote work has only added fuel to the fire of understanding your tax obligations as an employee or an employer. For those scenarios that apply to you, we recommend that you speak with a tax advisor about how to best navigate this complex landscape.

It is obvious that remote work has many benefits including flexibility and low cost. It does bring up tax issues, however. Being informed and seeking advice can help people and businesses comply with tax laws and avoid potential problems.

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Research suggests that working from home may benefit older people's mental health. For those nearing retirement age, remote work may reduce stress and increase job satisfaction (University of Michigan, 2022). This finding applies especially to our target audience of 60-year-olds who are Entergy workers about to retire or already-retired retirees. Aware of possible tax issues associated with working from, this group can also protect their financial interests while enjoying less stress and better job satisfaction when approaching retirement age.

Working from home is like going into unknown waters. As with sailing overseas, remote work means more flexibility. But like dangerous seas, there are hidden tax reefs to navigate. Take those tax questions as your personal compass when working from home. Like a seasoned sailor updating charts and course, you need to update your tax withholding and filing methods when you switch to remote work. Doing otherwise may trigger tax storms and financial penalties. Stay alert, hire a tax pro as your first mate, and enjoy your remote work adventure.

Sources:

Fregeau, Harrison. 'Personal Income Tax Implications of COVID-19 & Remote Employment.' Review of Banking & Financial Law , vol. 40, 2021, www.bu.edu .
Pearson, Brian T. 'How the Increase in Remote Employees Due to COVID-19 has Impacted Local Income Tax Revenues for U.S. Cities.' University of Kentucky , 2023, uknowledge.uky.edu/mpampp_etds/421.
'Charting a New Fiscal Course for Hawaii: Fiscal Architecture Approach.' UHERO , 2021, www.uhero.hawaii.edu .
'Remote worker state income tax implications.' Cornell University Division of Financial Services , 2020, finance.cornell.edu.
'Considering the impact of Remote Work on Income Tax Refunds: Michigan Municipal Governments.' Michigan State University , 2022, www.canr.msu.edu .

How does Entergy Nuclear Operations, Inc. determine the eligibility criteria for employees participating in the pension plan, and what specific conditions must be met for an employee to qualify for benefits under Appendix G of the Plan?

Eligibility Criteria for Pension Plan: Entergy Nuclear Operations, Inc. determines pension eligibility based on Vesting Service and age. Employees generally become 100% vested after five years of service or upon reaching age 61 while employed. Special provisions may apply to employees who participated in the Vermont Yankee Plan as of July 31, 2002(Entergy_Nuclear_Operati…).

What are the specific steps and necessary documentation required for an employee of Entergy Nuclear Operations, Inc. to commence their pension benefits once they reach retirement age, and how does this process differ for those with previous employment at other participating companies?

Commencing Pension Benefits: To commence pension benefits, an employee must file an application with the Entergy Pension Resource Center (EPRC). This includes providing necessary documentation, such as proof of age and employment history. Employees who have worked for other participating companies must account for service under prior employers, which may impact the pension calculation(Entergy_Nuclear_Operati…).

In what ways does Entergy Nuclear Operations, Inc. ensure that employees understand their rights under the Employee Retirement Income Security Act (ERISA), and what resources are available for employees seeking clarification on their pension benefits?

ERISA Rights and Resources: Entergy Nuclear Operations, Inc. ensures employees understand their rights under the Employee Retirement Income Security Act (ERISA) by providing access to the plan documents and offering assistance through the Entergy Pension Resource Center. Employees can request clarification on pension benefits by contacting EPRC(Entergy_Nuclear_Operati…).

How does the non-bargaining and bargaining employee classification at Entergy Nuclear Operations, Inc. impact the pension benefits available, and what should employees consider when planning for retirement in light of these classifications?

Impact of Non-Bargaining and Bargaining Classifications: The classification between non-bargaining and bargaining employees affects pension benefits. Non-bargaining employees are covered under Appendix G of the Plan, which may provide different accrual rates and benefit options compared to bargaining employees. These classifications impact retirement planning, as different rules may apply depending on the classification(Entergy_Nuclear_Operati…).

What provisions are in place at Entergy Nuclear Operations, Inc. for beneficiaries to receive benefits upon an employee's death, and how do these benefits differ based on whether the employee had already commenced their pension?

Death Benefits for Beneficiaries: In the event of an employee's death, the Entergy pension plan provides benefits to beneficiaries. If the employee has already commenced pension payments, the form of payment selected will determine the survivor benefits. If the employee passes away before starting pension benefits, the spouse may receive pre-retirement survivor benefits(Entergy_Nuclear_Operati…).

How does Entergy Nuclear Operations, Inc. calculate the normal retirement pension, and what factors play a crucial role in determining an employee's monthly benefit under Appendix G of the Plan?

Pension Calculation Factors: The normal retirement pension at Entergy Nuclear Operations, Inc. is calculated using a formula based on Average Earnings and years of Benefit Service. The formula includes percentages of earnings, capped at certain limits, and service years to determine the monthly pension benefit under Appendix G(Entergy_Nuclear_Operati…).

What unique considerations should employees of Entergy Nuclear Operations, Inc. keep in mind regarding service credits, particularly if they have accrued time under a prior employer's defined benefit plan?

Service Credits for Prior Employers: Employees with service under a prior employer's defined benefit plan may have their service credited toward the pension plan at Entergy Nuclear Operations, Inc. This includes specific provisions for employees from companies like Vermont Yankee. Service credits from prior employers may affect both vesting and benefit calculations(Entergy_Nuclear_Operati…).

How does Entergy Nuclear Operations, Inc. handle the transition of employees who transfer from covered employment with the potential for pension benefits, and what impact does this have on their accrued service time?

Impact of Employee Transfers on Pensions: If an employee transfers from covered employment (i.e., eligible for the pension plan) to a position not covered by the plan, their Benefit Service is frozen. However, Vesting Service continues to accrue as long as the employee remains with the company, and previous service may impact final pension benefits(Entergy_Nuclear_Operati…).

What specific contact methods are available for employees of Entergy Nuclear Operations, Inc. to reach the Entergy Pension Resource Center for assistance regarding their pension benefits, and what type of inquiries can the center effectively handle?

Contacting the Entergy Pension Resource Center: Employees can contact the Entergy Pension Resource Center (EPRC) for assistance with their pension benefits via phone at 1-855-523-3772 or online at EPRC Website. Inquiries can include questions about benefits, beneficiary designations, and how to commence pension payments(Entergy_Nuclear_Operati…).

In what scenarios might an employee's pension benefits at Entergy Nuclear Operations, Inc. be suspended, and what steps can be taken to appeal or rectify such situations once they occur?

Suspension of Pension Benefits: Pension benefits may be suspended if an employee is rehired after retirement and works more than 40 hours in a month. Employees who experience benefit suspensions can have their pension recalculated upon final retirement, with offsets for any benefits previously received(Entergy_Nuclear_Operati…).

With the current political climate we are in it is important to keep up with current news and remain knowledgeable about your benefits.

Entergy Corporation offers a robust retirement plan system for its employees, which includes both pension and 401(k) options. The Entergy Corporation Retirement Plan for Non-Bargaining Employees transitioned to a Cash Balance Plan on July 1, 2014, and underwent further amendments in 2023 and 2024. As of January 1, 2024, accrued benefits for specific participants were transferred to the Entergy Corporation Retirement Plan VI for Non-Bargaining Employees. This shift includes participants who were previously under Appendix J of the former retirement plan, now governed by the new Appendix J of Plan VI (SEC.gov). The pension plan utilizes a Cash Balance Equalization formula, which was initially implemented in 2014 and amended in 2023. The plan stipulates that employees accumulate retirement credits based on their compensation and service, with an annual interest credit added to their retirement accounts. Non-bargaining employees with at least five years of service qualify for this pension plan

Entergy announced in early 2024 a significant restructuring plan aimed at optimizing its operational efficiency. This includes streamlining operations and reducing overhead costs. The plan involves job cuts in non-essential roles and is part of a broader effort to enhance financial stability amid changing energy market conditions. Source: Business Insider

In 2022, Entergy Corporation granted stock options and RSUs as part of their long-term incentive plan. Stock options were available to executives and senior management, while RSUs were provided to a broader group of employees including middle management and high performers. Entergy typically uses the acronym "SO" for stock options and "RSU" for restricted stock units.

Entergy Health Benefits Overview 1. Official Website Website: Entergy Careers Benefits Information: Entergy offers a comprehensive benefits package that includes medical, dental, and vision coverage. They provide a range of plans with varying levels of coverage and cost-sharing options. Employees can also access wellness programs and preventive care services. 2. Benefits Information Website: Entergy Benefits Summary Benefits Information: Entergy's benefits summary highlights health insurance options, including PPO and HMO plans, a Health Savings Account (HSA), and Flexible Spending Accounts (FSA). They also offer mental health support and employee assistance programs. 3. News and Updates Website: Business Insider Recent News: In 2023, Entergy updated its health benefits plan to include enhanced telehealth services and expanded mental health resources in response to increased employee demand and well-being concerns. 4. Healthcare Terms and Acronyms Website: HR Dive Healthcare Terms: Common terms include HSA (Health Savings Account), FSA (Flexible Spending Account), PPO (Preferred Provider Organization), HMO (Health Maintenance Organization), and EAP (Employee Assistance Program). 5. Employee Healthcare News Website: Employee Benefits News Recent News: In 2024, Entergy introduced new wellness initiatives, such as on-site health clinics and enhanced maternity benefits, aimed at improving overall employee health and reducing absenteeism