Nevada Income Taxes

State Taxes at a Glance – Nevada

State Income Taxes in Nevada

Nevada is one of the best states in the country regarding taxes. They are one of 9 states that have no personal income tax. Like South Dakota, they have one of the strongest LLC protection statues in the country. This makes it an excellent place to start a business.

State Business Taxes in Nevada

The state of Nevada does not have business income tax; however, it does have a two separate business taxes called the Commerce Tax and Modified Business Tax.

Nevada Gross Receipts Tax

Nevada Gross Receipts Tax is called “Commerce Tax” – the Commerce Tax is a gross margins tax assessed on businesses that have over $4 Million in Revenue in Nevada. The tax is based on fiscal year (July 1st through June 30th of the following year) and you only must report to the State if your gross margins are over $4 Million. Your tax rate is based on your businesses NAICS code. The commerce tax rate is between 0.51% to 0.331%.

Here is a link to the Nevada Gross Receipts Tax Commerce Tax Form

Important things to keep in mind:

• Nevada Gross Receipts Tax (commerce tax) is due by July 31st.
• You can deduct the amount you paid in Commerce Tax on your Modified Business Payroll Tax (see below).

Sales and Property Taxes in Nevada

Sales Tax – Like many states, Nevada has multiple tax rates. One at the state level and another at the local level. The state rate is 6.85% the average local rate is 1.38% (total average rate for Nevada Sales Tax is 8.23%)

Property Tax – The average property tax rate for residential property in the state of Nevada is 0.60%, making it a very preferable place to own property. There is a cap on how much the state of Nevada can raise property taxes in a given year:

• Owner-occupied home – Maximum increase is 3% (e.g., Your property tax is $1,000 in year one, they can only raise it to $1,030 in year 2)
• Rental Property – Maximum increase is 8% (e.g., Your property tax is $1,000 in year one, they can only raise it to $1,080 in year 2)

Nevada DMV Tax

Since the state of Nevada doesn’t collect much in taxes, they make up for it by having one of the highest vehicle registration taxes in the country. It’s calculated on the value of your vehicle, so it’s deductible on your tax return. The state of NV created a nice tool for CPAs to look up your deduction for tax time. Here’s a link to find your Nevada DMV fees paid. You only need the license plate number and last name of the owner.

Nevada Tax on Social Security Benefits

Nevada does not tax social security benefits.

Payroll Taxes in Nevada

Unemployment taxes usually consist of three factors. They are the wage base, range of rates, number of schedules. Below is an outline of the three.

• Wage Base – Nevada has a high wage base of $40,100 (which is very high)
• UI Rates – range from 0.30% to 5.40%
• Schedules – Nevada has only one schedule of rates for UI taxes

Modified Business Payroll Tax

Modified Business Tax (MBT) – the Modified Business is a quarterly tax that is assessed on payroll. It is paid quarterly and are usually processed by payroll companies like ADP or Gusto. Your MBT is 1.378% of any wages you paid over $50,000 (less health insurance or wages paid to veterans) in the quarter. Additionally, you are allowed a tax credit for any Commerce Tax you may have paid.

Nevada Business Entities – LLCs

Nevada is one of the best states in the country to set up your LLC due to its robust LLC laws. Here are some important facts:

• Annual fee is $350 per year ($650 if you own a Corporation)
• First year you file there is an additional fee of $75.00
• Secretary of State of Nevada website – click here

Nevada Tax Contact Phone Numbers

Important phone numbers for the Nevada Department of Taxation:

• Website: tax.nv.gov
• Phone# for Individuals – None
• Phone# for Businesses – (866) 962-3707