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June 26, 2023
2023-1142

Nevada's Modified Business Tax to decrease effective July 1, 2023

The Nevada Department of Taxation (Department) announced that because the state's Modified Business Tax (MBT) collected in the previous fiscal year exceeded the forecasted amount by 4%, the MBT rates will decrease proportionately, effective July 1, 2023.

MBT rates effective July 1, 2023

  • General business. The MBT rate is 1.17% (previously 1.378%) of gross wages after deducting employee health benefits paid by the employer; the first $50,000 of gross wages is not taxable
  • Financial institutions and mining. The MBT rate is 1.554% (previously 1.853%) of gross wages after deducting employee health care benefits paid by the employer; there is no $50,000 exemption

Background

Employers subject to Nevada state unemployment insurance under NRS 612 are subject to the MBT except for non-profit organizations, Indian tribes, political subdivisions and employers with only household employees.

The MBT is paid on total gross wages and taxable tips as reported quarterly to the Nevada Employment Security Division (ESD) on Form NUCS 4072 less employee health benefits paid by the employer. For general businesses only, the first $50,000 of gross wages is not taxable.

When employers register with the ESD for state unemployment insurance they are automatically registered with the Department for the MBT.

To determine the MBT rate that applies, a business must self-report as general business, financial institution or mining.

For more information see the Department's frequently asked questions.

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Contact Information
For additional information concerning this Alert, please contact:
 
Workforce Tax Services - Employment Tax Advisory Services
   • Kristie Lowery (kristie.lowery@ey.com)
   • Kenneth Hausser (kenneth.hausser@ey.com)
   • Debera Salam (debera.salam@ey.com)

Published by NTD’s Tax Technical Knowledge Services group; Andrea Ben-Yosef, legal editor

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