Learn about the annual report and tax filing obligations for Utah limited liability companies.
To establish and operate a Utah limited liability corporation (LLC), you must prepare and submit a number of paperwork with the state. This article discusses the most significant Utah LLC continuing reporting and state tax filing obligations.
Report Annual
For your LLC, the state of Utah requires you to submit a yearly report (also known as a renewal). Around 60 days before the yearly report is due, the DOC should send you a renewal notification. The report may be filed online, or you can get a blank report/renewal form from the DOC website. To complete the annual report, you must first submit the name of your LLC and its state-issued entity number.
The report is required each year on the anniversary of the formation of your LLC. The price for filing is $15. There is also a penalty charge if you file beyond the due date.
State Corporation Tax
Most LLCs are pass-through tax corporations when it comes to income taxes. In other words, the burden for paying federal income taxes is passed via the LLC to the individual LLC members. LLCs do not pay income taxes by default; only its members do. Some states charge LLCs a separate tax or fee for the privilege of conducting business in their jurisdiction. Utah, on the other hand, is not one of those states.
However, in certain situations, the owners of an LLC elect to have their firm taxed as if it were a corporation. This decision is made by submitting IRS Form 2553 to the IRS. (The form is available on the IRS website.) When an LLC elects to be taxed as a corporation rather than as a pass-through entity, the firm must submit a separate tax return. Utah, like almost every other state, has a corporate income tax (more specifically called the corporation franchise and income tax). The corporate income tax in Utah is normally computed as a flat 5% of Utah taxable income, with a $100 minimum tax. This tax must be paid if your LLC is taxed as a corporation. The Utah State Tax Commission (TC) receives the state’s business income tax return (Form TC-20).
Employer Taxes in the State
Do you have workers in your LLC? If this is the case, you must pay employer taxes. Some of these taxes are paid to the federal government (the IRS) and are not addressed in this section. (However, it is important to understand that federal employer tax duties begin with getting a federal employer identification number (EIN).) Employers in Utah, on the other hand, must pay state taxes.
Firsts, you’ll need to withhold and pay employee income taxes to the Utah State Tax Commission (TC). Begin by registering your company with the TC, either online or in print form (TC-69, Utah State Business and Tax Registration). Once registered, you must submit withholding taxes on a regular basis (such as monthly or quarterly) using any variation of Form TC-941. Each year, you must additionally complete Form TC-941R to balance your LLC’s tax withholding.
You’ll also need to register to pay state unemployment insurance (UI) taxes. The Utah Department of Workforce Services is in charge of these taxes (DWS). These taxes may be registered for online or via DWS-UI Form 1. Then, utilize DWS-UIC Form 33H to record salaries and pay UI taxes each quarter.
Taxes on Sales and Use
If your LLC sells items to Utah clients, you must collect and remit sales tax. You must register with the Tax Commission for this purpose and then make periodic sales tax payments for products sold. You may register in person (using Form TC-69) or online. After registering, you will be given a sales tax number and a sales tax license. Then, on a regular basis (quarterly or monthly, for example), you must file sales tax returns to the Tax Commission (any variation of Form TC-62).
Other States Registration
If you want to do business in states other than Utah, your LLC may need to be registered in any or all of those states. The exact states concerned will determine if you are needed to register: each state has its own regulations for what defines conducting business and whether registration is required. For registration reasons, having a physical presence (a business location) in a state, recruiting personnel in a state, or soliciting business in a state (through telephone, print advertisements, mail, or the Internet) are sometimes considered conducting business. Obtaining a certificate of authority or comparable document is normally required for registration.