Additionally, as of January 1, 2022, employers are also required to report independent contractors on their payroll if the latter has a contract that pays them $2,500 or more for their work. Under the Tax Department’s new hire reporting laws, you must report a new hire or a rehired employee within 20 days of the hiring date. In New York, the Department of Taxation and Finance (frequently called the Tax Department) is responsible for administering payroll taxes at the state level. We’ll cover that and more in this helpful primer. To run a small business or a global corporation successfully in the Empire State, you must have a good understanding of the different types of New York state taxes, each of the tax rates, and who owes what when.

Similarly, if your business is growing and you’re bringing on more new hires, your employer tax contributions will be higher, as will the income tax withholdings from employees’ gross pay. Simply put, the more your employees earn, the more they’ll owe the state. New York is known for its complex tax system, which includes a progressive income tax. And, regulations vary across the state, so it’s crucial to understand the tax and labor laws in New York to avoid penalties. Not only does the Empire State boast beautiful, diverse locations, ranging from vibrant New York City to quiet Westchester County and beach-filled Long Island, but you also have access to a tremendous talent pool.Īs New York employers know, however, running a company in NYS also comes with the responsibility of state payroll taxes on top of US FICA taxes, like Medicare tax and Social Security tax. There are many reasons to start a business in New York state.

New york state unemployment tax form