A tax lawyer is a vital member of your legal team. From advising you on corporate structure and deals to representing you in the event of an audit, you’ll likely need a New York tax lawyer at some point in your company’s lifecycle. The New York tax code is notoriously complex, but with Priori Legal, you can find a New York City tax lawyer with exactly the tax expertise your business needs, and schedule a complimentary 30 minute consultation.
How to Get a New York Tax ID
Every business in New York must be registered with tax authorities from the day operations begin. Once you have registered for an Employer Identification Number (EIN) or Federal Tax Identification Number federally, you must also register with New York tax authorities. Every company must file for a tax Certificate of Authority and a NY.gov ID with the NYS Department of Taxation and Finance. These IDs will allow you to pay all relevant New York taxes and use the online small business tax portal.
New York State Taxes
New York requires companies to pay many types of state and local taxes. The most important of these is corporation tax. If your company is incorporated as a corporation, you will pay taxes as an independent tax entity at rates determined by the size and profits of your company. You may also owe withhold tax if you have employees on payroll. Even LLCs, partnerships, and other pass-through entities will owe withholding tax.
Sales tax also affects many New York businesses. If you sell personal property, most goods will be subject to sales tax, and personal services, such as hairdressing, tanning, and even parking are also taxed in New York. The current state sales tax rate is 4%, but the exact percentage that you will owe depends on the city, country and Metropolitan Commuter Transportation District where your company is located. New York City, for example, has a sales tax of up to 8.875%. This must be recorded carefully and paid in a timely manner, generally quarterly.
Federal Business Taxes
In addition to New York taxes, all corporations and other companies considered individual tax entities must pay federal income taxes. These are levied according to how much money a company earns throughout the year. If you are not sure whether the IRS expects your company to file a corporate income taxes, it may help to speak with a New York tax lawyer. Keep in mind, as well, that if you have any employees, you will be expected to withhold social security taxes on behalf of the federal government regardless of whether your owe corporate income taxes.
Minimizing Your Taxes in New York
New York is known as a state with a complex tax code and relatively high corporate taxes, something that can hurt small businesses that do not carefully plan for taxes. Luckily, New York business taxes can be minimized with the right tax planning strategy. You simply will need to consult an experienced NYS tax attorney about your unique tax situation. This can not only reduce your taxes for the current year, but it can also minimize your company’s tax burden in the long term.
What if my company is audited in New York?
Audits are scary for any company. They can be expensive and time-consuming, but they are not necessarily the disaster you may think they can be. If you are being audited in New York by either the IRS or the NYS Department of Taxation and Finance, you may not be under suspicion of doing anything wrong. These audits can be triggered randomly or after certain events like bankruptcy. The best thing you can do to protect your company is to hire a qualified New York tax attorney to guide you through this process in a way that minimally affects your business.
Are there franchise taxes in New York?
Yes, and it’s not always clear which companies may owe this tax. Generally, you may owe New York franchise tax if your company is incorporated in New York, but operating outside the state as well. The best way to determine whether or not you owe franchise taxes is to consult an NYS tax lawyer.
Do I owe state taxes outside New York?
You might if you are operating outside New York. You may owe sales tax, for example, in other states where you have a physical presence. It will ultimately depend on your unique business operations, so it is best to discuss your tax obligations with a New York tax lawyer.