Nevada LLC Taxes

Knowing the tax obligations that affect your Nevada limited liability company (LLC) is vital in order to avoid monetary fines and/or penalties and ensure your business operates legitimately. 

Even though this is important regardless of the size of your business, knowing exactly what taxes you’ll need to pay at the local, state, and federal levels is not always simple, especially as a first time business owner. 

This article will explore current Nevada LLC taxes requirements, and offer a detailed guide on the correct process you’ll need to follow in order to file your taxes correctly. 

Recommended: Schedule a free consultation with 1-800Accountant to stay on top of your taxes. 

How Is an LLC Taxed in Nevada?

Taxation in Nevada isn’t applied in the same way to all LLCs – instead, it varies depending on a number of factors, such as an LLC’s nature, locality, and tax election.

While LLCs typically benefit from pass-through taxation by default, they can elect to be taxed as one of the following:

• C Corporations: The LLC is treated as a separate entity to its owners, paying corporate tax and state commerce tax on its total profit, while the owners also pay personal income taxes on any distributions they take.
• S Corporations: In return for paying owners a “reasonable salary,” the LLC’s remaining profits are distributed among members without a need to pay FICA or self-employment taxes on them.

The following sections go into the various tax responsibilities of your LLC at local, state, and federal levels in Nevada to help you ensure your LLC navigates them effectively.

Nevada Local Taxes

The tax laws and regulations differ across various jurisdictions in Nevada, with each locality having its own set of specific tax requirements. 

Here's a list of potential taxes that may be applicable in your city or county:

Sales and Use Taxes

If you are engaged in selling goods or services within Nevada or to customers based in Nevada, it's important to be aware that you may be required to collect a sales and use tax that is specific to your area. The maximum local tax rate is capped at 1.53%. This cap is in addition to the state sales tax rate of 6.85%, making the total maximum possible sales and use tax rate in some areas of Nevada as 8.375%.

In Nevada, there are four types of local authorities that have the power to levy these taxes: 

• Counties
• Cities
• School districts
• Special districts

To simplify the collection and reporting of sales tax, Nevada assigns a four-digit code to each area with a distinct sales tax rate. These codes are based on the location of the sale or the delivery of the product, not the location of the seller. You can use this Nevada Sales Tax Calculator to look up the sales tax rate and the four-digit code by address or zip code. 

Note: Refer to the Nevada Department of Taxation’s Sales and Use tax Publications for a list of sales tax rates and codes by county and city. 

Special Situations

To accurately determine the applicable local sales/use tax for your LLC in Nevada, you need to consider the following guidelines:

• Local Sales Tax: Determined by the location where the sale is completed or where the physical exchange of goods occurs. For instance, if you have a retail store, the local sales tax rate would be based on the store's physical location.
• Local Use Tax: Determined by the location where the purchased goods are delivered or used. For example, if your business purchases equipment online and it is shipped to your office, the local use tax rate would be based on your office's location.

However, there are several specific scenarios in Nevada where these general rules might be applied differently. These include:

• Sales Involving Shipped Goods: If goods are shipped to a customer in a different locality, the sales tax rate of the customer's locality might apply instead of where the sale originated.
• Special Tax Districts: In areas with special tax districts, additional taxes may be levied on top of the standard local sales/use tax.
• Online Sales: For online sales to Nevada customers, the tax rate could be determined by the customer's delivery address.
• Trade Shows and Temporary Events: If your LLC sells goods at trade shows or other temporary events in different localities, the local sales tax rate of the event's location may apply.

To learn more about the special tax situations and requirements, see the Nevada Department of Taxation’s Sales Tax Information & FAQs page.

Property Tax

In Nevada, there is no statewide property tax; instead, it is set and managed by each county’s assessor, auditor-controller, treasurer-tax collector, and clerk of the board offices. These local government offices handle property value assessments, tax bill calculation and preparation, tax collection and distribution, and appeals on property tax assessments

To find out more about the property tax system in your local area, you’ll need to reach out to one of the following offices in your county’s:

• Assessor’s office: For questions about the taxable value of your property, the assessment process, or the exemptions available.
• Auditor-controller’s office: For questions about the tax rate that applies to your property or the tax bill calculation.
• Treasurer-tax collector’s office: For questions about the collection of tax payments and various payment options and assistance programs. 
• Clerk of the board’s office: For questions about the appeal process if you disagree with your property tax assessment or bill. 

Note: To assist you in locating the necessary contact details, you can refer to the county and city clerk available through the Nevada Secretary of State website.

Recommended: Schedule a free consultation with 1-800Accountant to ensure your business remains legally compliant.

Nevada State Taxes

Every state has its own regulations and rules that dictate how it taxes individuals and businesses. Below is a list of the most relevant state-level taxes for LLCs in Nevada. 

Commerce Tax

Nevada does not require franchise taxes for businesses like LLCs. In fact, Nevada is one of the few states that does not have any state-level income tax, corporate income tax, or franchise tax. This means that LLCs in Nevada only have to file a federal income tax return as well as self-employment tax return, as well as any local sales tax or use tax that may apply to their transactions.

There is one exception to this rule. If an LLC in Nevada has a gross revenue of more than $4 million per year, it has to file a Commerce Tax Return (also known as a Gross Receipts Tax Return) with the Nevada Department of Taxation. 

The Commerce Tax is a tax on the gross revenue of businesses in Nevada, regardless of their profit or loss. The tax rate varies depending on the industry of the business, ranging from 0.051% to 0.331%.

This state tax is due annually by the 45th day following the end of the fiscal year, which is June 30th for most businesses. The Commerce Tax Return can be filed online or by mail using this form. 

Note: If an LLC in Nevada does not have a gross revenue of more than $4 million per year, it does not have to file a Commerce Tax Return, but it still has to file an annual Commerce Tax Return Exemption Form with the Nevada Department of Taxation. 

Modified Business Tax

The Nevada Modified Business Tax (MBT) is a state-level tax imposed on businesses operating within the state of Nevada. It's not a local tax but rather administered by the state government, specifically by the Nevada Department of Taxation. 

The MBT is primarily a payroll tax. It is calculated based on the gross wages paid by employers, with certain deductions allowed (such as health care benefits paid by the employer).

This tax applies to general businesses and financial institutions, but the rates and specific rules can differ between these categories. The tax rate for general business is 1.378% on wages after deduction of health benefits paid by the employer. 

However, the first $50,000 of gross wages per quarter is not taxable. The tax rate for financial institutions is 2% on wages after deduction of health benefits paid by the employer. There is no taxable wage threshold for this classification.

This tax is due quarterly by the last day of the month following the end of the calendar quarter. The tax return can be filed online using the Nevada Tax Center or by mail using the appropriate form. 

Sales-Related Taxes

Nevada imposes state-level sales and use taxes on the sale, lease, or rental of tangible personal property. The flat rate of the state sales tax in Nevada is 6.85%. 

However, most counties charge a local surtax on top of the state sales tax, increasing the total sales tax that must be collected and remitted by the seller. Those local rates can be up to an additional 1.525%. Currently, combined Nevada sales tax rates range from 4.6% to 8.265%, depending on the location of the sale. 

There are also some additional taxes that are applied if your LLC sells specific products in Nevada, such as a:

• 10% tax on the retail sale of marijuana and marijuana products
• 15% tax on the wholesale sale of marijuana and marijuana products
• $1.80 tax per pack of 20 cigarettes
• 30% tax on the wholesale price of other tobacco products

Some products are exempt from the Nevada LLC tax, such as unprepared food, farm machinery and equipment, newspapers, prescription medication, and medical devices. 

Note: If your business plans to sell taxable goods or services, you must obtain a sales and use tax permit from the Nevada Department of Taxation. You can register online with SilverFlume.

Transportation Connection Tax

Nevada requires transportation taxes for businesses that provide passenger transportation services in the state. This is also known as the Transportation Connection Tax or the Passenger Transportation Tax. 

It is a 3% excise tax on the total fares charged by taxicabs, common motor carriers, and transportation network companies. Businesses that are subject to this tax must obtain a Transportation Connection Tax Permit from the Nevada Department of Taxation. You can apply for this permit online through the SilverFlume portal. 

To learn more about the different types of taxes in Nevada and how they apply to your business, you can visit the Nevada Department of Taxation website.

Federal Taxes

Regardless of where your business is located, if you run an LLC in the US, there are a number of federal taxes you’ll need to pay. Below, we’ve explored some of the main types your LLC may be required to pay for federal tax purposes:

Income Tax

By default, the IRS will not treat single and multi-member LLCs as a separate entity from you for tax purposes. What this means is that you’ll need to report your share of your LLC’s profits on your individual tax returns and pay federal income tax on them at the personal rate of your tax bracket.

Having said that, keep in mind that LLCs can also elect to be taxed as C corps or S corps, which changes how these taxes are levied in different ways.

Self-Employment Tax

In addition to income tax, members of single- and multi-member LLCs will need to pay self-employment tax on the share of the business’s profits that they report on their personal tax return at the end of the year.

This tax is levied at a flat rate of 15.3% against businesses with net earnings that exceed $400, though it is applied slightly differently to LLCs that have elected to be taxed as S corps or C corps.

Employment Tax

If your LLC hires any employees, it will need to withhold a portion of their salaries to cover various types of taxes on your employees’ behalf – including Social Security, Medicare (FICA), and payroll taxes.

Furthermore, the members of any LLCs that have elected to be taxed as an S corp will be required to pay employment taxes on their salaries. However, in return for this, the remainder of the business’s profit after these salaries have been distributed will be safe from both self-employment and FICA taxes.

Excise Tax

If your LLC engages in certain types of business (such as the sale of alcohol and tobacco or operating a heavy highway vehicle, among others), it may need to pay federal excise taxes in order to do so legally. Each excise tax comes with its own set of rules, rates, and filing obligations you’ll need to be aware of.

Understanding and fulfilling these federal tax obligations is crucial for keeping your LLC compliant and avoiding unnecessary financial penalties and/or fines.

How to File LLC Taxes in Nevada

Below, we’ve outlined the general process an LLC in Nevada will need to follow in order to file their tax return correctly. Note that the specificities of each step will vary slightly depending on how your LLC is organized and the specific locality it’s based in. 

Step 1: Gather Your Documentation

To ensure accurate tax filing, thorough record-keeping is essential. Begin by collecting your personal information, including:

• You and your partner’s Social Security number, date of birth, and residential address
• The previous year’s tax returns
• Your LLC’s Employer Identification Number (EIN)

Then, you’ll need to gather all documentation related to your business’s income, such as:

• Invoices you’ve issued
• Sales transaction logs
• Electronic payment reports from services like PayPal or Stripe

Lastly, assemble all records pertaining to your business expenses, which should cover:

• Lease receipts for your business premises
• Bills for utilities
• Records of office supplies purchases
• Documentation of business-related travel
• Payroll records for employees

Note: Depending on how your LLC is organized and its tax election, you may need different information for your tax return. 

Step 2: Find The Right Tax Forms

Once you've gathered all necessary documents, the next step is to select the correct tax forms for your LLC based on its organization:

• Single-Member LLCs: The business’s total income and expenses are reported on a Schedule C form, which is attached to the owner’s personal tax return and due by April 15 or the following business day if it lands on a weekend or holiday.
• Multi-Member LLCs: File an information return using Form 1065. Members must fill out a Schedule K-1 showing their individual earnings or losses by March 15 or the next business day.
• C Corporations: File a corporate tax return using Form 1120 by the April 15 deadline or on the next business day if it's a weekend or holiday.
• S Corporations: Use Form 1120-S for the corporate tax return and distribute Schedule K-1 forms to shareholders for reporting their shares of profits or losses. The deadline for filing taxes using 1120-S is March 15 or the following business day.

Since state and local taxes will have their own individual forms and requirements, we recommend contacting your municipality or hiring an accountant for guidance.

With the appropriate documentation gathered and the correct tax forms for your business entity on hand, you’ll be ready to fill them out and submit them.

Step 3: File Your Taxes

The majority of businesses choose electronic filing for its speed, enhanced security, and reliability compared to paper filing, which can be slower and more prone to errors. Here’s how it works:

• Federal Tax Returns: The IRS provides two electronic services for tax submission: Free File for businesses with an AGI below $72,000 and Free Fillable Forms for those above the threshold.
• State and Local Tax Returns: The Nevada Department of Taxation has resources on how to file different taxes, from sales and use taxes to commerce and modified business taxes, depending on the specific nature of your business. 

Note: These electronic filing tools are best suited for those who are already confident in handling their LLC taxes as if filling out a paper form. 

For new business owners, we recommend opting for the expertise of a tax professional in order to ensure both accuracy and compliance in your tax filings. 

Recommended: Schedule a free consultation with 1-800Accountant to stay on top of your taxes. 

Keep Your Nevada LLC Compliant

While LLCs are generally easier to maintain than corporations, there are certain state and local formalities your LLC must satisfy in order to remain compliant. 

Nevada LLC Annual List of Office and Managers

Nevada requires an LLC Annual Report, also known as an Annual List of Officers and Managers, to be filed with the Secretary of State every year. 

This report contains information about the LLC, such as its name, address, managers, members, and registered agent. Along with the Annual List, Nevada LLCs are also required to renew their State Business License annually.

The report is due by the last day of the anniversary month of the LLC’s formation or registration in Nevada. For example, if your LLC was formed on June 15, 2023, your report is due by June 30, 2024. The filing fee for the report is $150. You can file your report online or by mail.

Licensure and Tax Requirements

In Nevada, almost all businesses are required to obtain various licenses and permits at the local, state, and federal levels. Below, we’ve broken down three of the most common types your LLC may need:

• Sales and Use Tax Permits: If your LLC plans to sell tangible goods or services in Nevada, you must obtain a sales tax permit from the Nevada Department of Taxation. This permit allows you to collect and remit sales and use taxes to the state. You can apply for this permit online through SilverFlume.
• Professional Licenses: If your LLC offers certain professional services that require a license, certification, or registration in Nevada, such as medical, nursing, accounting, real estate, legal, or insurance services, you must obtain the appropriate professional license from the respective board or agency. For example, insurance agents who want to sell, solicit or negotiate insurance in Nevada must obtain a producer license from the Nevada Division of Insurance. 
• Environmental Permits: If your LLC engages in any activities that may affect the environment, such as air emissions, water discharges, waste management, or hazardous substances handling, you may need to obtain an environmental permit from the Nevada Division of Environmental Protection (NDEP). 

Note: To access a comprehensive list of the statewide licenses and permits that may be required for your LLC, visit the Licensing/Permits page offered by the Nevada Department of Business & Industry.

Nevada LLC Taxes FAQs