If you have Gross Receipts from Nevada sources, the new Commerce Tax may keep a portion of those Gross Receipts in the state. Last June, Nevada Governor signed into law Senate Bill No. 483 to introduce the Commerce Tax. Effectively July 1, 2015, Nevada joins Texas, Ohio and Washington in imposing tax based on the total gross revenue, otherwise known as the “Gross Receipts Tax.”
Commerce Tax Highlights
- The tax is imposed on any business entity engaged in business in Nevada with Nevada gross revenue in a fiscal year exceeding $4,000,000.
- The taxable year is the state’s fiscal year and begins on July 1, 2015
- The tax is collected annually with the first return and payment due on August 1, 2016 for July 1, 2015 – June 30, 2016. All businesses are required to file annually regardless of whether they have taxable liability
- The rate is based on a company’s NAICS code with the tax rate varying from 0.051% to 0.331.
- Businesses subject to the Commerce Tax will be entitled to a credit against their Modified Business Tax (MBT) lability equal to 50% of the Commerce Tax Liability.
Commerce Tax Guidance and Resources
To assist potential Commerce Tax taxpayers, Nevada’s Commerce Tax website provides additional resources and information such as:
- Draft Commerce Tax Return Instructions
- Draft Commerce Tax Return
- Nexus Questionnaire
- Commerce Tax Questions and Answers
- Proposed Regulation R123-15
In addition, the Commerce Tax Website invites those who may wish to comment to submit their comments by January 30, 2016 to firstname.lastname@example.org.
Finally, if upon review of the guidance and resources provided on the Commerce Tax Website you have questions, the Website’s “Commerce Tax Questions” area provides a link to the Department’s NEED HELP WITH COMMERCE TAX that contains a number to request an advisory opinion.
Don’t Become a “Whale” For The New Commerce Tax
As with any new tax legislation, getting up to speed on the Commerce Tax’s application and ramifications is critical to tax advisors and their clients. In Vegas parlance, ignorance of the Commerce tax can make a “Whale” of a multistate taxpayer with Nevada gross receipts.