Your business tax obligations don’t stop at the federal level. State and local government agencies want slices of your revenue, too.
State Income Taxes
Nearly every U.S. state has a business or corporate income tax on their books and your tax requirement depends on the legal structure of your business. For example, a Limited Liability Company (LLC) is taxed separately from the business owners, while sole proprietors use the same tax form to report personal and business income taxes.
State Employment Taxes
In addition to federal employment taxes, you must pay certain state employment related taxes as well. All states require payment of state workers’ compensation insurance and unemployment insurance taxes. The following states or territories also require businesses to pay for temporary disability insurance:
- New Jersey
- New York
- Rhode Island
- Puerto Rico