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In addition to business taxes required by the federal government, you will have to pay some state and local taxes. Each state and locality has its own tax laws. The links below provide access to key resources that will help you learn about your state tax obligations. The most common types of taxes requirements for small business include:
Tax Permit: In most states, business owners are required to register their business with a state tax agency and apply for certain tax permits. For example, in order to collect sales tax from customers, many states require businesses to apply for a state sales tax permit.
Income Taxes: Nearly every state levies a business or corporate income tax. Your tax requirement depends on the legal structure of your business. For example, if your business is an LLC, the LLC gets taxed separate from the owners, while sole proprietors report their personal and business income taxes using the same form. Consult the General Tax Information link under your state for specific requirements.
Employment Taxes: In addition to federal employment taxes, business owners with employees are also responsible for paying certain taxes required by the state. All states require payment of state workers' compensation insurance and unemployment insurance taxes. Five states (California, Hawaii, New Jersey, New York, and Rhode Island) and Puerto Rico require businesses to pay for temporary disability insurance.
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