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Setting up payroll in Vermont for the first time
Before you can pay employees in a new state, you must register with the state’s tax agencies. This lets you file and pay the right taxes.
Use the dropdowns below to learn more. Use CMD + F (or CTRL + F) to search for words in the article.
Gusto works with Middesk to help you register with tax agencies in new states.
For now, this includes: Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, and Wyoming.
Get help registering for state taxes
We can help you register for state tax accounts after you:
Cost, timeline, and who can register
The cost, steps, and turnaround time depend on the state. Gusto will show you these details when you start the registration process.
Middesk cannot help if your company is:
What the process looks like
Third-Party Access (TPA) and Power of Attorney (POA)reminder
Some state agencies need Gusto to have TPA or a POA on file to file and pay your taxes. Usually, Middesk does not set this up, so you’ll have to do it yourself after registration.
Check the state registration articles to see if TPA or POA is needed and how to set it up. If there's no “Authorize Gusto” section, then TPA is not needed right now.
If setting up TPA requires online agency portal access:The cost, steps, and turnaround time depend on the state. Gusto will show you these details when you start the registration process.
Need help with registration questions?
If you’re not sure how to answer one of the registration questions, check Middesk’s Help Center or email them at [email protected].
How to get started with state tax registration in Gusto:
Important: You may need to give Gusto access
Some states require you to give Gusto third-party access (TPA) or a Power of Attorney (POA) to your tax accounts. Middesk does not do this for you.
Need to make a change?
If you already submitted your info but need to fix something, email [email protected] to update it.
When your order is complete, you’ll get emails from Gusto and Middesk. They’ll detail the next steps, which include:
Before your order is done, you can check the order status in your Gusto account:
For most states where tax registration info is sent by physical mail, here's what to expect:
Q: Can I run payroll before my registration is done?
A: Yes. You may be asked to enter tax rates and tax deposit frequencies, but you can use temporary info.
Important reminders
Q: I need to change some of the registration information that was submitted. What do I do?
A: Email Middesk at [email protected].
Q: Can I use Gusto to register in a new state without a Federal Employer Identification Number (FEIN)? What if my business is merging or being acquired?
A: No, you need a FEIN in Gusto to get registration help for state taxes.
If your business is merging or being acquired, Middesk cannot help with registration. You'll need to work with a tax advisor and state agencies directly.
Q: What if I'm not liable for unemployment tax yet?
A: If you want Middesk to start setting up an unemployment account number before you're liable, you can:
Q: Can Middesk help if the responsible party is international without an ITIN or SSN?
A: No. Middesk cannot help in this scenario, you'll need to register on your own.
Q: Why am I unable to enter 0% ownership for the responsible party or add a commercial owner?
A: Some states have a 1% minimum for the responsible party's ownership percentage. These states include ID, KS, MN, OH, SC, DC, DE, MD, NJ, NY, and RI.
You’ll need to place registration orders directly with Middesk outside of Gusto or register directly with the agency.
Some states require an individual owner to be listed. If you’re a non-profit or unsure, contact Middesk for help at [email protected].
Q: When will my tax account information be available?
A: Each state and agency takes a different amount of time to process a registration. To estimate when your state tax account info will be available, check the Post Submission Questions in Middesk's help article.
Q: Where can I find my tax information?
A: You can find your tax info in several places:
Gusto’s state tax registration service does not contain tax, legal, financial, or HR advice. Since rules and regulations change over time and can vary by location, consult a lawyer, HR expert, or accountant for specific guidance.
Q: Does Middesk help with giving Gusto third-party access (TPA) or Power of Attorney (POA) for tax payments?
A: Some state agencies need Gusto to have TPA or POA access to file and pay your taxes. Usually, Middesk does not set this up, so you’ll have to do it yourself after registration.
Check the state registration articles to see if TPA or POA is needed and how to set it up. If there's no “Authorize Gusto” section, then TPA is not needed right now.
If setting up TPA or POA requires online agency portal access:
Q: Does Middesk help close state tax accounts?
A: No, you'll need to close the tax account yourself.
Q: Can I cancel my Middesk order?
A: At this time, we do not support order cancellations or refunds.
Q: What is Middesk's phone number?
A: To get support from Middesk, you must email them at [email protected]. They can help with registration-specific questions, or changing info that's already been submitted. For all other questions, you can message Gusto.
Click the dropdowns below to learn how to register your business with Vermont agencies—you'll need to register with the Secretary of State first. Do not forget to give Gusto the authorization we need to file and pay certain taxes for you.
You must register with the Vermont Secretary of State before signing up for any state tax accounts.
Rules may be different based on your business type, so it’s always a good idea to talk to a lawyer or business expert to make sure you’re meeting all legal requirements.
Who does not need to register?
If you're not on this list, you must register.
Most businesses in Vermont need to register with the Vermont Department of Taxes. You'll need a "business tax account" for things like:
Keep the registration timelines below in mind when planning your first payroll in Vermont.
Nonprofit organizations that qualify for exemptions need to register before using an exemption certificate. You can learn more about how to register a nonprofit organization.
Step one: Register with the Secretary of State
Vermont offers an online service center to help you register your business and apply for any and all licenses or insurance you need. Here's how:
Step two: Register for the Business tax
You should get your account number within 5-7 days.
If you have questions, contact the agency at (802) 828-6802 or email them at [email protected].
Business Tax account number format
It should start with "WHT" followed by a “10” or “11” (e.g., WHT10######, or WHT11######).
After a work address in Vermont is assigned to one or more employees, you can add your tax account information:
Most companies in Vermont must start paying unemployment insurance tax once they have:
Your business type (general, non-profit, etc) can impact when the company is responsible for paying this tax. We recommend contacting the agency to confirm when the company will be liable.
If you need to run payroll but do not yet meet the requirements, enter the new employer rate for Vermont in Gusto temporarily. Update the rate once you get it.
You'll get your Employer Number and unemployment tax rate ~two weeks after registering online.
Important reminder about unemployment rate updates
Vermont usually gives new tax rates each year starting on July 1. When you get notified about your new rate, update it in Gusto with the right start date. If you do not know your rate, call the agency at (802) 828-4344.
After a work address in Vermont is assigned to one or more employees, you can add your tax account information:
If you're already registered in Vermont, you'll need to enter your tax account details in Gusto.
You must be registered with one or more of these agencies for Gusto to file and pay taxes for you:
If you still need to register, click the applicable dropdown above in this article.
If you've paid employees in Vermont before, you can find your Withholding Account Number on letters from the Vermont Department of Taxes.
It should start with "WHT" and be followed by a “10” or “11” (like WHT10###### or WHT11######).
If you do not know your account number, call (802) 828-2551, option 3, or email [email protected].
Look for your Employer Number and unemployment tax rate on letters from the Vermont Department of Labor, such as:
If you cannot find it, call (802) 828-4344. If you do not have your rate yet, enter the new employer rate for Vermont in Gusto for now. Update the rate once you get it.
Unemployment rate updates
Unemployment tax rates change each year starting on July 1. When you get your new rate, update it in Gusto with the right start date.
Do not forget to send a notarized Power of Attorney (POA) to Gusto so we can file and pay unemployment taxes for you.
After a work address in Vermont is assigned to one or more employees, you can add your tax account information:
If you edit a tax account number after payments or filings have already been made, there may be tax implications. Learn how to pull reports in Gusto that can help you correct any historical tax issues related to tax account number updates.
When setting up Vermont taxes in Gusto:
Check out Vermont Form HC-2 for more info.
If you do not offer health care to all employees, Gusto will estimate your HCC cost with each payroll and make adjustments at the end of the quarter based on the agency’s rules.
Employees who do not get health insurance from their job (an employer-sponsored health plan) must fill out Form HC-2 each year to declare their health coverage status.
Keep this form for three years. You do not need to send it to the state. Gusto doesn’t collect or store this form.
Important to know
For more info, contact the agency at (802) 828-2551 or [email protected].
Health Care Contribution (HCC) Annual Statement
Vermont requires employers to give employees a yearly statement showing:
You can find this info in Gusto:
Starting July 1, 2024, employers in Vermont must pay a 0.44% payroll tax on Vermont-employee wages. Gusto will calculate and pay this tax for you (paid to the Department of Taxes).
Employers can also choose to deduct up to 25% of the tax (0.11%) from employees' wages. To do this:
Once payroll is run for the quarter, the percentage can only be updated for the next quarter.
CCC payroll tax is paid to the state at the same time and in the same way as income tax withholding, with quarterly reporting on the WHT-436.
Power of Attorney (POA) is needed for:
To let Gusto file and pay your Vermont unemployment tax, you need to submit a notarized Power of Attorney (POA) form to the Vermont Department of Labor. Here’s how to do it:
To let Gusto submit withholding tax amendments for you, you need to give Gusto third-party access (TPA) to your Vermont myVTax account. Follow these steps:
You can view forms in Taxes & Compliance > Tax documents. Switch between the tabs to find federal, state, W-2s, and 1099s.
To see what Gusto has paid on your behalf, run the Agency Payments report.
Learn how to close or reopen tax accounts here.