What do I need to know about the new Nevada commerce tax laws?
The state of Nevada has been a proud supporter of out-of-state businesses for years – imposing the attractive corporate income tax rate of zero percent. Aside from Delaware, Nevada’s low incorporation fees and friendly tax laws make it one of the most popular incorporation states in the U.S.
However, on July 1, 2015, these perks were tweaked by the legislature’s new commerce taxes, which apply to those with Nevada-source income. The following are some of the highlights of the tax bill:
- Businesses reporting a gross, in-state revenue in excess of $4 million will be subject to a commerce tax. The rate will vary depending on the industry, and will range from 0.051 percent to 0.331 percent.
- Regardless of income, all businesses incorporated in Nevada must file an annual Commerce Tax Return.
- Commerce taxes are due within 45 days of the taxable year.
- In-state license fees for corporations have increased from $200. to $500. However, license fees for pass-through entities remains fixed at $200.
While Nevada is still a highly attractive state in which to incorporate, it is important to be mindful of these recent tax law changes – as hefty penalties await any business that does not adhere to the new changes. According to the Department of Taxation, entities required to file a Commerce Tax Return include corporations, S corporations, partnerships, proprietorships, limited liability companies, business associations, joint ventures, limited-liability partnerships, business trusts, professional associations, joint stock companies, holding companies and any other person engaged in a business.
Moreover, there are special exemptions, deductions, and classifications under the law – particularly pertaining to the gaming and entertainment industries. To ensure compliance, contact an attorney today.