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Your Guide to Nevada’s Payroll Taxes

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If you’re a business owner or an individual working in Nevada, understanding payroll taxes is a must for staying compliant with state regulations and avoiding potential penalties.

May 17, 2024
Author: NCH

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Nevada is known for its vibrant entertainment scene and bustling cities, but businesses also thrive there. Whether you’re a business owner or an individual working there, understanding payroll taxes is essential for staying compliant with state regulations and avoiding potential penalties.

Understanding Nevada’s Payroll Tax Structure

Payroll taxes are taxes employers must withhold and remit on behalf of their employees. These taxes fund various government programs such as Social Security, Medicare, and unemployment insurance.

In Nevada, there are specific state-level payroll taxes that both employers and employees need to be aware of. These include the following:

  • State Income Tax: Unlike most states, Nevada does not impose a state income tax on wages. This means that employers in Nevada are not required to withhold state income tax from their employee’s paychecks.
  • Workers’ Compensation Insurance: Nevada mandates workers’ compensation insurance coverage. The premiums for this insurance are based on factors such as the nature of the business, employee classification, and claims history.
  • Federal Income Tax: While Nevada has no state income tax, employers must still withhold federal income tax from their employees’ wages. The federal income tax rates vary depending on the employee’s income level and filing status. Employers can refer to the IRS Publication 15 (Circular E) for the latest federal income tax withholding tables.
  • Social Security and Medicare Taxes: Employers in Nevada must withhold Social Security and Medicare taxes from their employees’ wages. The former’s tax rate is 6.2% of wages up to a certain annual limit, while the latter’s is 1.45% of all wages.
  • State Disability Insurance (SDI): Although Nevada doesn’t have a state disability insurance program, employers may need to comply with federal requirements under the Family and Medical Leave Act (FMLA).
  • Nevada Modified Business Tax (MBT): The MBT is a tax on wages employers pay in certain industries. It is calculated based on the total wages paid to employees each quarter. The rate will depend on the employer’s gross wages and industry classification.
  • Unemployment Insurance Tax: Nevada requires employers to contribute to the state’s unemployment insurance fund. The unemployment insurance tax rate varies based on the employer’s industry, experience rating, and overall state unemployment rate.

Important Deadlines to Remember

Type of Obligation

Instruction

Due Date

Monthly Deposits

Deposit federal income tax withheld from employees’ wages, along with a share of Social Security and Medicare taxes

15th day of the following month or the next business day (if the 15th falls on a weekend or holiday)

Quarterly Wage Reporting

File Form 941 (the Employer’s Quarterly Federal Tax Return) for reporting wages paid to employees and taxes withheld 

Last day of the month per quarter (April 30, July 31, October 31, and January 31)

Annual Wage Reporting

File Form W-2, Wage and Tax Statement to report wages and taxes withheld for each employee

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January 31 of the following year

New Hire Reporting

Report newly hired or rehired employees within a specified timeframe

Within 20 days of the new hire’s start date or date rehired after a break in service 

State Unemployment Insurance Reporting

Report wages and pay unemployment insurance taxes quarterly

Last day of the month per quarter (April 30, July 31, October 31, and January 31)

Registration Process

Before operating in Nevada, employers must register with the appropriate state agencies to fulfill payroll tax obligations. The registration process may involve the following steps:

  1. Know Your Status: Before registering for payroll taxes, determine whether you are classified as an employer by Nevada state law. In most cases, if you have employees in Nevada, you’re considered an employer and must register for payroll taxes.
  2. Obtain an Employer Identification Number (EIN): If employers don’t already have one, they should obtain one from the IRS. An EIN is required for federal tax purposes and is used to identify businesses for payroll tax reporting.
  3. Register with the Nevada Department of Taxation (NDOT): To register for payroll taxes in Nevada, you must submit Form NJR-01 to the NDOT. This form can be completed online through the Nevada Tax Center (NTC) portal or by mail. 
  4. Select Payroll Tax Accounts: During registration, choose the appropriate payroll tax accounts based on your business structure and tax obligations. Common payroll tax accounts include Unemployment Insurance (UI) Tax, State Disability Insurance (SDI) Tax, and State Income Tax Withholding.
  5. Register with the Nevada Employment Security Division (ESD): Employers must register with the Nevada Employment Security Division to report and pay unemployment taxes. It can be completed online through the ESD’s online database.
  6. Obtain Necessary Business Licenses: Depending on the nature of the business, employers may need to obtain additional licenses or permits from local or state authorities before operating in Nevada.
  7. File Necessary Forms: Employers must file forms to report wages and taxes withheld once registered. These forms include Form 941 for federal taxes, Form W-2 for annual wage reporting, and quarterly wage reports for state unemployment insurance taxes.

The Bottomline

Understanding and following Nevada’s payroll tax requirements is necessary for employers operating in the state. By familiarizing yourself with the tax rates, important deadlines, and registration process outlined above, you can ensure that your business remains in good standing with state and federal tax authorities.

At NCH, we understand the importance of complying with Nevada’s payroll tax regulations. As a trusted resource for businesses operating in the state, our experts provide personalized support and guidance to ensure our clients meet their payroll tax obligations accurately and on time.

Call us today at 1-800-508-1729 to ensure your tax obligations are in expert hands.

DISCLAIMER: The above material has been prepared for informational purposes only, containing opinions of the provider and is not intended to provide, and should not be relied on for, tax, legal, or accounting advice. Please consider consulting tax, legal, and accounting advisors before engaging in any transaction.

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