Starting a business in Nevada can be exciting, especially if you have a brilliant idea for your company. However, you can’t make that idea a reality until you cover a handful of legal requirements. These include properly structuring your business and getting your tax ID numbers in place. Nevada’s state economy is growing at a level comparable to the national average, at an annualized rate of 3.3 percent. This is up from its 2016 growth rate of a mere 1.4 percent. Small businesses are largely responsible for this economic development, together adding 26,753 net new jobs in 2018. Accommodation and food services are the top category of small businesses in Nevada, but there are also many opportunities in sectors like healthcare and social assistance, construction, retail trade, and administrative, support, and waste management. There are many big cities where entrepreneurs can find a niche for themselves, including Las Vegas, Reno, and Carson City.
Steps to Obtaining a Tax ID (EIN) Number and Registering a Nevada Business
- Forming a Business in Nevada
- Federal Tax ID (EIN) Number Obtainment
- Nevada State Tax ID Number
- Localized Licenses and Permits in Nevada
When you start making moves for your business, you’ll need a formal business structure in place. To make a more informed decision, it’s recommended that you research the different structures, including these main types of business structures:
- Sole proprietorships and partnerships. Sole proprietorships and partnerships are basic business structures, and are fairly straightforward to create and manage. In them, you’ll pay taxes as an individual on any money you make in the business. However, you’ll be exposed to much greater personal liability; you could be held liable for any business decisions or actions you make, and will hold all debts personally.
- Limited liability companies (LLCs). LLCs are slightly more complicated since they exist as separate legal entities. They can hold debts of their own, and can shield you from some liability issues. LLCs are considered pass-through entities for tax purposes. This means they don’t pay taxes on the revenue they generate, but you’ll pay taxes as an individual on money you take from the business, usually in the form of a salary or as profits. LLCs can have multiple members, but may be individually owned. In Nevada, LLCs are required to file an annual report with basic information about the company.
- Corporations. Corporations are easily the most complicated business structure because of their ability to issue public shares as a way to raise funds. This is a unique advantage, and one that comes with stricter rules and regulations than other companies face. This also makes them well-suited for long-term expansion and growth. Corporations are treated as separate legal entities like LLCs, and provide their owners with significant liability protection. However, corporations must pay federal taxes on eligible revenue, resulting in double taxation, since owners must pay taxes on profits, dividends, and other income from the business. In Nevada, there is no state-level corporate income tax. However, you may owe a modified business tax (MBT) rate of 1.17 percent if taxable wages exceed $62,500 in a quarter. Otherwise, no MBT will be due.
The majority of Nevada businesses will need to get a federal tax ID number. This number, 9 digits long and unique to your company, will serve as a unique identifier at the federal level, not unlike a social security number (SSN). You’ll also hear it called an employer identification number, or EIN. You’ll need an EIN if your business has multiple members or if you’re going to hire employees. It’s also a requirement for most bank account or loan applications, and for most license and permit applications.
The easiest way to get your federal tax ID number is to use our federal tax ID number obtainment services. Use our online service to answer a few questions about your business, and we’ll send you your tax ID via email in less than an hour.
Your business could also require a Nevada state tax ID number. This is another unique identifier for your business, but it applies at the state level. You’ll need this number if you plan on selling taxable goods and services in the state, if you’re hiring Nevada employees, or if you’re going to owe excise taxes, which apply to alcohol, tobacco, and other regulated goods.
Your first step in getting a Nevada state tax ID number is to get your federal tax ID number. Once you have that, you can use our Nevada state tax ID number obtainment services. Fill out our online questionnaire, and you’ll receive your Nevada state tax ID number in 4 to 6 weeks.
Many Nevada businesses will be required to have a license, permit, or other form of certification before they can operate legally. However, there isn’t a straightforward, generic business license that covers all industries and business types. There are some licenses and permits that apply at the state level, but there are many more that apply at the city or county level, and requirements may vary from local area to local area. There are also different requirements for different industries. Because things can get complicated fast, it’s best that you talk to someone at your local Chamber of Commerce to determine which business licenses or permits you need, if any.
Nevada small businesses enjoy a healthy environment for entrepreneurship and economic development. There are currently 254,337 Nevada small businesses, which represent 99.1 percent of businesses in the state. Combined, these businesses employ 474,535 people, who represent 42 percent of the total workforce in the state.
Once you have your tax IDs in place and your business structure decided, you can launch your business and start generating revenue. Make use of our federal tax ID number and Nevada state tax ID number obtainment services to get the tax ID numbers you need faster and more conveniently.