How the engine decides

Income tax, in sequence

1. Neither state taxes wages. If both the work state and the residence state are among the 9 without a wage income tax, the analysis ends: nothing is withheld.
2. Same state. If residence and work are the same state, that state's withholding applies to everything and no interstate question arises.
3. Reciprocity. If the work state has an agreement covering residents of the residence state, the work state stands down and the residence state governs — conditional on the employee filing the work state's nonresident exemption certificate. The District of Columbia is handled separately: the Home Rule Act bars it from taxing nonresidents at all, which behaves like universal reciprocity but is not a bilateral agreement.
4. Work state has no wage income tax. The obligation moves to the residence state if it taxes wages.
5. De minimis threshold. If the work state publishes a day-count or dollar threshold and the facts entered fall below it, no work-state withholding is triggered yet. The engine flags that the threshold is typically retroactive once crossed.
6. Otherwise. The work state governs, and the residence state's credit mechanism is flagged rather than modelled, because credit computation depends on the return, not on payroll.

Convenience of the employer

Applied as an overlay, not a substitute. If the arrangement is remote, is not marked an employer necessity, and the employer's state is one of the 6 that apply a convenience rule, the engine raises it as a double-taxation risk with a documentation action. It does not attempt to predict the outcome of a facts-and-circumstances test.

Unemployment insurance

The DOL localization-of-work test, applied strictly in order. In the overwhelming majority of employment arrangements factor one resolves it: services performed entirely in one state localize the whole job there. The engine does not split unemployment wages between states, because no state permits that for a single job.

What the engine will not do

• Calculate tax. It tells you which state's tax applies, not how much. Rate tables, allowances and supplemental rates are a different problem.
• Decide nexus. Employing someone in a state usually creates income tax nexus for the employer as well, and that question depends on facts the engine never sees.
• Resolve local jurisdiction. It flags that a state has local income taxes and tells you reciprocity will not cover them. It does not resolve an address to a specific municipality, because that requires a geocoded jurisdiction boundary set.
• Guess. Where a state's own published guidance could not be confirmed, the field is empty and labelled unconfirmed rather than filled from a secondary source.