If you have contractors in your home state, it may not be a big deal for you to run your own back-office, particularly if you are already processing payroll and handling taxes, unemployment, Workers' Compensation, benefits, etc. for your own staff.
But before you can take placements in other states, you're going to have to do a lot of legwork and homework. Every state has different laws and requirements you will have to follow for the contractors you have placed there. For example, each state has specific tax requirements, so you will have to get registered to pay those taxes and handle any withholding, reporting, reconciliation, etc., that are involved. The regulations are different in each state, so you will also have to invest a lot of time researching upfront.
For more information, download our free Checklist for Making Contract Placements Outside Your Home State.
If you don't feel that your firm has the time or resources to take on these additional tasks, that doesn't mean you have to turn down out-of-state contract job orders. You can outsource those placements to a contract staffing back-office that will take on those responsibilities as the W-2 employer of your contractors. Often, you can still run placements from your home state through your own back-office, but outsourcing the out-of-state placements can save you the headaches and expenses associated with getting set up and having contractors in other states.