Nevada is one of a handful of states with no corporate income tax and no personal income tax. Instead, it raises money from a 6.85% minimum sales tax, gaming and tourism taxes, a payroll tax called the Modified Business Tax and a Commerce Tax on gross revenue above $4 million. Annual fees for LLCs and corporations are higher than in most states.
This guide covers Nevada's business taxes for 2026, with worked examples and comparisons with California and other neighbors.
Nevada business taxes at a glance
For a small Nevada business, the absence of income tax is the headline benefit. Owners pay no state tax on profits, wages or capital gains. The business pays the Modified Business Tax only on payroll above $50,000 a quarter, so many small employers owe little or nothing. The Commerce Tax applies only above $4 million of Nevada revenue. The costs that do apply to everyone are annual fees of $350 for LLCs and $650 for corporations, and a sales tax that is above 8% in Las Vegas and Reno. Nevada is especially attractive to businesses relocating from California.
No income tax
Nevada's constitution prohibits a personal income tax, and the state has never imposed a corporate income tax.
- C corporations pay no state tax on profit.
- LLC owners, partners and sole proprietors pay no state tax on business income.
- S corporation shareholders pay no state tax on their share.
- Capital gains from selling a business are not taxed by Nevada.
Residents still pay federal income tax. Nevada businesses earning income in other states may owe those states' income taxes.
Commerce Tax
| Item | Detail |
|---|---|
| Threshold | Nevada gross revenue above $4 million |
| Rates | 0.051% to 0.331%, depending on industry |
| Example rates | Mining 0.051%; retail 0.111%; professional services 0.239%; rail transportation 0.331% |
| Filing | Annual return due August 14 for the fiscal year ending June 30 |
| Credit | Up to 50% of Commerce Tax paid can be credited against the Modified Business Tax |
All businesses with a Nevada business license must file the Commerce Tax return, even if their revenue is below $4 million.
Modified Business Tax (payroll tax)
| Employer type | Rate | Threshold |
|---|---|---|
| General businesses | 1.17% | Wages above $50,000 per quarter |
| Financial institutions and mining | 1.853% | All wages above a small threshold |
Employers can deduct qualifying health insurance costs paid for employees. A business with $300,000 of quarterly payroll pays about $2,925 a quarter.
Sales and use tax
| Component | Rate |
|---|---|
| Statewide minimum (state plus mandatory local) | 6.85% |
| Clark County (Las Vegas) | 8.375% |
| Washoe County (Reno) | 8.265% |
| Average combined rate | About 8.24% |
- Groceries and prescription drugs are exempt.
- Most services are not taxed.
- Remote sellers with more than $100,000 of Nevada sales or 200 transactions must collect.
Other Nevada taxes
- Live entertainment tax: 9% on admissions to certain live entertainment venues.
- Gaming taxes: Casinos pay gross gaming revenue taxes of up to 6.75%, plus license fees.
- Room taxes: Local transient lodging taxes of 12% to 13% or more in Las Vegas.
- Property tax: Nevada caps increases in property tax bills, and rates are moderate. Business personal property is taxable.
- Unemployment insurance: Employers pay on a wage base above $40,000. New employers start at 2.95%.
Forming a business in Nevada: fees and ongoing costs
| Item | LLC | Corporation |
|---|---|---|
| Formation filing fee | $75 | $75 or more (based on authorized shares) |
| Initial list of managers or officers | $150 | $150 |
| State business license | $200 | $500 |
| First-year total | $425 | $725 or more |
| Annual list (each year) | $150 | $150 |
| Business license renewal | $200 | $500 |
| Annual total | $350 | $650 |
Worked example: $500,000 of profit
| Step | Amount |
|---|---|
| Taxable income | $500,000 |
| Nevada corporate income tax | $0 |
| Federal tax at 21% on $500,000 | $105,000 |
| Total income tax | $105,000 (21%) |
The business would also pay the $650 annual fees and Modified Business Tax on payroll above $50,000 per quarter. For a single LLC owner with $150,000 or $75,000 of profit, Nevada income tax is $0.
How Nevada compares with its neighbors
| State | Corporate rate | Top personal rate | State sales tax |
|---|---|---|---|
| Nevada | None (Commerce Tax) | None | 6.85% |
| California | 8.84% | 13.3% | 7.25% |
| Oregon | 6.6% to 7.6% | 9.9% | None |
| Idaho | 5.3% | 5.3% | 6% |
| Utah | 4.45% | 4.45% | 6.1% |
| Arizona | 4.9% | 2.5% | 5.6% |
The contrast with California is the main reason businesses move to Nevada. A California owner earning $500,000 pays more than $40,000 of state income tax; the same owner in Nevada pays none. Oregon has no sales tax but high income taxes. Utah and Arizona have low income taxes, but Nevada's is zero.
Choosing an entity in Nevada
- LLC: $350 a year in fees and no state income tax for owners.
- S corporation: No state income tax, with federal payroll tax savings, but $650 a year in fees.
- C corporation: No state income tax, so the combined rate is just the 21% federal rate. This makes C corporations more attractive in Nevada than in most states for businesses that retain earnings.
Who pays the most in Nevada
Nevada's tax burden falls on consumption, payroll and tourism rather than income. Large employers pay the Modified Business Tax on wages, and big companies pay the Commerce Tax. Consumers pay high combined sales taxes, and visitors pay steep room and entertainment taxes. Small businesses with modest payroll pay mostly flat annual fees, which can be relatively expensive for side businesses but trivial for established companies.
Tax planning tips for Nevada businesses
Don't form in Nevada if you operate elsewhere. If your business is run from California or another state, that state will treat it as doing business there. You'll pay both Nevada's fees and the other state's taxes. Nevada formation makes sense for businesses based in Nevada.
Establish Nevada residency carefully if relocating from California. California's Franchise Tax Board aggressively audits former residents. Move your home, records, bank accounts and business operations, and keep evidence of where you spend your time.
Claim the health insurance deduction on the MBT. Employers can deduct qualifying health benefit costs from wages subject to the Modified Business Tax, which can eliminate the tax for some employers.
Doing business across Nevada
Nevada's economy is concentrated in two metro areas. Las Vegas and Clark County account for roughly three-quarters of the population and are dominated by tourism, gaming and conventions, while Reno and Washoe County have grown into a logistics, manufacturing and technology hub, helped by proximity to Northern California. Local taxes differ between them: Clark County's sales tax is slightly higher, and room taxes in Las Vegas are among the highest in the country.
Recent changes for 2025 and 2026
- Modified Business Tax rate held at 1.17% for general businesses.
- Commerce Tax thresholds and rates unchanged.
- Film tax credit expansion debated as part of studio projects in southern Nevada.
Is Nevada a good state for business?
Advantages
- No corporate or personal income tax
- No tax on capital gains
- Business-friendly courts and corporate laws
- Proximity to California markets
Drawbacks
- Annual fees of $350 to $650 or more
- High combined sales taxes in major cities
- Payroll tax for larger employers
- Economy concentrated in tourism and gaming
Compliance checklist
- File Articles of Organization or Incorporation with the Secretary of State, along with the initial list and business license.
- Register with the Department of Taxation for sales tax and the Modified Business Tax.
- Register with the Employment Security Division for unemployment insurance if you hire.
- File the annual list and renew the business license each year.
- File quarterly Modified Business Tax returns.
- File the annual Commerce Tax return by August 14.
Compare Nevada with its neighbors below or estimate your taxes in the United States calculator. See LLC taxes for more.