The Commerce Journal,Business and Local Businesses
*The Commerce Journal>>>United States Taxes

Relocating a business to Las Vegas to save on tax?

I have a couuple questions:

1. If Joe has a business grossing $300,000 yearly located in Massachusetts, and that business would have the same gross when relocated anywhere else, then is it wise to relocate the business to Las Vegas, since the state of Nevada has the lowest tax rate in the nation?

2. If so, then when would be the latest time he could relocate and avoid Massachusetts tax? (for example, if he relocates the business by March, then does he pay tax for Massachusetts for 3 months, and Nevada tax for 9 months, or will he be able to avoid Massachusetts tax entirely and only pay Nevada taxes?)

Assuming Joe reports his business on a Schedule C, then he would pay a 5.3% tax to Massachusetts on his TAXABLE income, not his GROSS income.

In the year Joe moves, he will file a part year Massachusetts income tax return and report his taxable income up to the date he bacame a Nevada resident. In your example, he would pay tax on 3 months income to Massachusets.

My question to you is, is the tax savings worth giving up your lifestyle and friends to live in Las Vegas?

Jim KIrby, CPA/PFS, CFP, CFS

Tags
　　Austin 　　Atlanta 　　Other - Business & Finance 　　Other Taxes 　　United States Taxes 　　United Kingdom Taxes 　　Spain Taxes 　　Singapore Taxes 　　Mexico Taxes 　　Ireland Taxes 　　India Taxes
Related information
  • Do I get any of my property tax refunded?

    Put taxes paid on your federal return, they will be calutaled in figuring your refund if you have one coming.

    ...
  • When is the transfer of property assumed for federal tax purposes?

    It was a 2007 gift completed this year. A gift tax return Form 709 will be due showing her low cost basis carries over to you. Very bad planning. If she retained a life interest in the deed, or ...

  • Help The 1040 form 2441 is not delayed.?

    Do you mean what is the difference between 1040 and 1040A? The 1040 has more lines to list more information. The 1040A is a simpler form of the 1040.

    ...
  • Do I have to select 1 on lines A & B on the W-4 if I match the criteria. I want to claim zero on everything.?

    Yes, you can claim zero on the W-4. In fact, you can have extra income tax withheld if you request it. If you have more than one job or outside income, claiming zero exemptions may be recommended.<...

  • Do i need my w-2 forms to begin my rapid refund at h&r block jan.2nd?

    In order to actually file a tax return, you do have to have your reporting documents, such as W2's. However, at H&R Block, you can take your last pay stub in and they can "jump start&...

  • Should i pay my property taxes now or wait until next year?

    If you want more money back for this tax year, pay your property taxes now (posted by December 31). This will reduce your deductions for next year, thereby increasing next year's taxes. Good l...

  • Does Amazon.com charge tax?

    Yeah they do and shipping

    ...
  • Claiming tuition on my Wisconsin income taxes?

    First off, books are not tuition. Yes, I know they are horribly expensive, but that doesn't make them a qualified education expenses. (If the school supplies the books on the first day of cl...

    • 　

    Commerce Categories--Copyright/IP Policy--Contact Webmaster