Welcome to Nevada Commerce Tax!

  • July 14, 2016

Did you get that letter from the Nevada Department of Taxation? The one that says, “Welcome To Nevada Commerce Tax”.Dept of Taxation Letter1

If you have a business entity or state business license registered in the State of Nevada, you probably just received a “Welcome to Nevada Commerce Tax” letter.  Generally, “Welcome To” and “Tax” are not words we like to see together.

The commerce tax, previously discussed here, imposes annual commerce tax on business gross revenues generated in Nevada over $4,000,000 during the previous fiscal year.  The amount of the tax is based on your registered industry code. Each business category is assigned its own gross receipts tax rate with rates ranging from 0.051 percent to 0.331 percent. Businesses which do not fit into any other category are taxed at the 0.128 percent rate for Unclassified businesses.

Business Category Tax Rate Business Category Tax Rate
Rail Transportation 0.33% Management of Companies 0.14%
Educational Services 0.28% Utilities/Telecommunications 0.14%
Waste Management Services 0.26% Other Transportation 0.13%
Publishing, Software, Data Processing 0.25% Warehousing and Storage 0.13%
Real Estate 0.25% Unclassified 0.13%
Arts, Entertainment, and Recreation 0.24% Retail Trade 0.11%
Truck Transportation 0.20% Financial Activities 0.11%
Accommodation 0.20% Wholesale Trade 0.10%
Food Services (includes restaurants) 0.19% Manufacturing 0.09%
Health Services 0.19% Construction 0.08%
Professional Services 0.18% Agriculture 0.06%
Administrative and Support Services 0.15% Air Transportation 0.06%
Other Services 0.14% Mining 0.05%

Regardless of the amount of gross revenue, each business is required to file a return. August 15, 2016 is the due date for the first return and any payment which may be due.

Since the commerce tax legislation was enacted, Incline Law Group LLP has been counseling clients on its potential impact on their businesses. Of particular concern to many of our real estate clients is the impact of the tax on the sale or leasing revenues of real estate holdings. There are a number of ways that such holdings can be held and structured to minimize the impact of commerce tax on these ventures.  Likewise, careful planning can minimize the impact of these taxes on non-real estate related ventures or businesses which own a mix of real estate and provide other goods or services.

Businesses that may be subject to the new commerce tax are highly advised to consult with their legal and tax advisors prior to filing their first return in August. We would also highlight that the return is based on a fiscal, rather than calendar, year which may prove inconvenient for businesses operating on a calendar year tax election.

If you have questions about the commerce tax you may find information at www.nevadatax.nv.gov or feel free to call our office.

The Thunderbird Yacht is Back…

  • July 13, 2016

…and it is just in time for its birthday. The drought that hit the sierras after the historic 2010-2011 ski season has been devastating to many parts of California and Nevada. Lakes and reservoirs dried up, thunderbird-tahoe-0_Cwildfires raged, and a number of other negative effects were caused by the extended drought. The 2015-2016 ski season was not a huge winter, historically, but it did work wonders in bringing Lake Tahoe back above its natural rim and beyond. Water is flowing into the Truckee River, the boat ramps around the lake are accessible, and the most beautiful and historic yacht on Lake Tahoe is back in the water.

In 2014, the Thunderbird Yacht had engine trouble in both of its engines. The Thunderbird Lodge Preservation Society’s Executive Director and Curator, Bill Watson, did what he does best. He raised enough money to rebuild the engines. Even before they were reinstalled in the yacht, they were on display at the Thunderbird Lodge and looked spectacular. Everyone was excited to get the yacht back into operation.

Unfortunately, the winter did not provide enough snowmelt in 2014-2015. This left the dock that houses the Thunderbird with insufficient water to store the infamous yacht. Again, Mr. Watson was able to make something good out of an otherwise unfortunate situation. Recently, the bottom of the yacht was replaced, some of which had not been replaced since 1939 (when the yacht was originally constructed), even though most wood bottoms only last 20-30 years.

The Thunderbird Yacht was recently relaunched and sent back to its boathouse. This is just in time for her 76th birthday in mid-July (July 14). If you have not been to the Thunderbird Lodge, you should definitely go take a tour. The Yacht itself is worth the trip. Add in all the history, the tunnels, and the ever-popular opium den and you have an experience to remember. Plus, your money goes toward a great cause: keeping the property maintained and open for us all to enjoy.