According to income sourcing rules, what generally controls the sourcing of wages and personal service income?

The sourcing of wages and personal service income is primarily determined by where the service is performed. This principle reflects the idea that the earnings from personal services directly correspond to the location where the work is executed. For instance, if an individual provides services in a particular state or country, the income generated from those services is typically sourced to that location, thereby subjecting it to the tax laws applicable there.

The location of the employer, while potentially relevant in other contexts, does not take precedence over where the services are actually rendered. Similarly, the residence of the payer could influence other types of income or tax considerations but is not the decisive factor for wages and personal service income. Timing of payment also does not play a role in determining the sourcing of such income, as it pertains more to when the income is received rather than where the income is generated through services performed.

Understanding this concept is crucial for tax compliance and planning, especially in cases where individuals may work in multiple jurisdictions or travel for work.