State and Local Tax
Payroll Taxes
Navigating state payroll taxes can be challenging, especially when it comes to out-of-state employees. Determining whether you should pay state unemployment tax on their wages or withhold state income tax involves understanding the nuances of each state’s regulations. For instance, some states require employers to pay unemployment taxes if the employee works remotely within their borders, while others have specific thresholds based on employee location and hours worked. Similarly, withholding state income tax can vary depending on the employee’s residency and where the work is performed. We can help you untangle these complexities, ensuring compliance and minimizing potential liabilities. Let us guide you through the intricacies of state payroll tax obligations so you can focus on growing your business.
Sales Tax
Does sales tax apply to your business? Understanding your sales tax obligations is crucial, especially in light of evolving regulations and the concept of “nexus.” Nexus refers to the connection your business has with a state, which can determine whether you need to collect sales tax on your sales. If you have a physical presence, employees, or significant sales in a state, you may be required to register and collect sales tax there. We’re here to help you navigate these complexities, ensuring compliance while optimizing your tax strategy.
What is “nexus,” and does it apply to my business?
The 2018 Supreme Court case South Dakota v. Wayfair fundamentally transformed the landscape for retail businesses operating online by allowing states to impose sales tax on out-of-state sellers without a physical presence, a concept known as “nexus.” Previously, the physical presence requirement meant that only retailers with a brick-and-mortar location in a state were obligated to collect sales tax from customers in that state. The ruling granted states the authority to tax online sales based on economic and virtual connections, significantly expanding their revenue streams. As a result, many online retailers, regardless of their size, now face complex compliance challenges, needing to navigate varying sales tax rates and regulations across different jurisdictions. This has heightened operational burdens for small and mid-sized businesses while leveling the playing field with local retailers, which have long been subject to sales tax obligations. Consequently, the ruling has prompted many e-commerce platforms to enhance their tax compliance systems and strategies, reshaping the competitive dynamics in the retail sector. Contact us today and we’ll help you determine whether your business is impacted by this ruling.
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Whether you’re new to business or well-established, we have the expertise needed to assist you. From sole proprietors to multi-state businesses, we got you covered.
