- I’m starting a business. What do I need to do about the city taxes?
I’m starting a business. What do I need to do about the city taxes?
You will normally have to remit two types of city taxes: the net profit tax and (if you have employees) the employee withholding tax. The first is the tax due on profits of your business, whether your business is a sole-proprietorship, corporation or partnership. Incidentally, Ashland taxes the net profits of S-Corporations at the corporate level. As such, the individual shareholders of S-Corps are not taxed. Partnerships can file and pay the tax at the entity level or file an informational return and each individual partner then files and pays his/her share of the tax. To remit the second type of tax, the tax withheld from your employees’ wages, you will need to establish a withholding account with us. You can do this by completing a Business Questionnaire form. Your Federal Identification number plus a 2-digit number we assign is used for your account number. Employers are liable for all Ashland withholding taxes that should have been withheld from their employee’s wages even if those taxes were not, in fact, withheld.