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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.
🎥 Watch a quick video to learn how registering in a new state works
📚 See our blog for full state business guides
Expand the sections below to learn more. Use CMD + F (or CTRL + F) to search for words in the article.
Let Gusto Business Compliance register your business in this state and keep you compliant after that. We'll register you with the state, act as your registered agent, file your annual reports, watch your government mail, and give you a concierge team. Learn more about Gusto Business Compliance.
Prefer not to use Business Compliance? We can still help you register in this state through our partner Middesk, with no monthly subscription. Order a one-time state tax registration.
Expand the sections below to see if you qualify, what's covered, how to sign up, and what happens next.
You can add Business Compliance if all of these are true:
You run payroll with Gusto. Business Compliance is not sold on its own.
You're on the Solo, Simple, Plus, or Premium plan. It's included with Premium at no extra cost.
Your business is a corporation or an LLC. Corporations include S corporations and nonprofit corporations. An LLC qualifies however it's taxed.
New sign-ups are not available for professional entities, including professional corporations and professional limited liability companies (PLLCs). If you already have a Business Compliance subscription as a professional entity, your coverage continues as it is.
Business Compliance is not available yet for sole proprietors, general partnerships, limited partnerships, or limited liability partnerships (LLPs). It's also not available for cannabis-related businesses, on any plan.
Not sure if you qualify? Chat with us before you sign up.
Business Compliance works state by state. Each state you add includes:
Registered agent — we accept legal and government mail for your business in that state.
Change of registered agent — we file the change so your mail comes to us.
Foreign qualification — we register your business with the Secretary of State so you can legally work there.
State tax registration — we register you with the state's tax agencies when you hire or start working there, including local tax agencies and Paid Family and Medical Leave (PFML) agencies wherever Gusto is able to register with them.
Annual report filing — we file the yearly report that keeps your business in good standing.
Government mail monitoring — we scan mail from state agencies into Gusto. Each notice comes with a plain-language summary of what it means and what to do next.
Proactive alerts — we tell you about deadlines before they're due.
You also get a compliance concierge team, no matter how many states you cover.
Cost: $85 per state, per month, billed monthly. Adding a state commits you to 12 months of coverage in that state. It's included with Premium at no extra cost. State filing fees are charged at cost, vary by state and business type, and show on your invoice.
Local tax and PFML coverage follows what Gusto's state tax registration supports, and not every agency can be registered through Gusto. Delaware and Maine do not allow a third party to register for Paid Family and Medical Leave, so you'll register with those agencies yourself. If we cannot register one of your agencies, we'll show it on your registration page under what you'll complete on your own. See Let Gusto help you with state tax registration.
Sign in to Gusto.
Go to Taxes & Compliance.
Select Business compliance.
Answer the questions about your business and the states where you work.
Review the price and what's included, then confirm.
After your first state is set up, you'll see its registrations and anything left to do.
When you add an employee or work location in a new state, that state shows up under Your states as Setup in progress, with your next step. Steps often include telling us more about your business there and moving your registered agent to us.
Select Start on a task to finish it, or View state details to see everything for that state. When every step is done, the state changes to Active.
To be your registered agent in a state, we file a change of registered agent with that state.
When a state needs this, you'll see a task on that state's card under Your states. Select Start to begin.
Keep your current registered agent until we confirm the transfer is done. A gap in coverage can put your business out of good standing in that state.
Once a state is active, we take over the ongoing work. We review your government mail, track your deadlines, and give you a concierge team to ask about any of it.
Your Business compliance page also shows your Compliance documents and Tax account details for each state.
Because we're your registered agent, legal mail for your business comes to us.
Other mail from state agencies is scanned into Agency notices on your Business compliance page. Each notice shows the state it came from, when it arrived, and a plain-language summary of what it means and what to do next. Select Unread or State to filter the list.
Still not sure what a notice means? Select Ask concierge about this mail on that notice. Your concierge team will follow up and explain what, if anything, you need to do.
If a notice is about your state payroll taxes, your concierge team brings in our tax resolution team. Learn more in How to handle a tax notice from an agency.
When you sign up, you get a compliance concierge team. They'll:
Learn about your business and the states where you work.
Check in regularly to make sure your filings are on track.
Explain any government mail you're unsure about.
Answer questions about your account.
To reach them, select Talk to a compliance concierge on your Business compliance page, or email [email protected].
We track filing and renewal deadlines for the states you cover. This includes annual reports, franchise tax filings, and business license renewals.
You'll get a notice in Gusto and by email before each deadline.
We file what we can for you. If a filing needs your approval, we'll send it to you with time to review.
Go to Taxes & Compliance → Business compliance → Manage subscription.
To stop coverage in one state, select Remove next to that state.
To cancel Business Compliance, select Leave Business Compliance.
Each state you add runs for a 12-month term, and you're billed monthly over that term. If you want to remove a state or leave Business Compliance before that term is up, email your compliance concierge team at [email protected] first. They'll tell you what happens to the rest of the term.
If Business Compliance is included with your Premium plan, you'll see a note on this page.
Before you remove a state: We'll stop being your registered agent there. Most states require one, so appoint a new agent to stay in good standing. We'll also stop tracking that state's mail and deadlines.
These services are charged separately from your subscription, on your regular Gusto invoice. Order them from your Business compliance page when you need them:
Certificate of good standing — $99 per certificate. Official proof that your business can operate and is in good standing. You may need one for a loan, a contract, or investors.
State account closure — $549 per order. We close your state tax accounts when you stop working in a state.
State filing fees are charged on top of these prices, at cost. They vary by state and by business type, so you'll see your total before you confirm the order. The filing fee appears as its own charge, separate from the service itself.
Legal and tax advice. We do not give legal or tax advice. For advice about your business, talk to a lawyer or an accountant.
Payroll taxes. Gusto payroll already handles the taxes tied to paying your team. Business Compliance covers what your business owes as a business.
Forming a new business. We register an existing business in a new state. We do not form new businesses.
Sales tax. We do not register you for sales tax or file sales tax returns.
Professional and industry licenses. We do not get or renew licenses for your profession or industry, or handle their reporting.
Reinstatements and reopened accounts. We do not reinstate a business with the Secretary of State or reopen closed payroll tax accounts.
General mail. We monitor payroll and compliance notices from government agencies, not your other mail.
Q: Why does my business need to register in a state?
A: Once you have an employee, a location, or other business in a state, that state's rules apply to you. This includes registration, filings, taxes, and renewals. It's separate from registering to run payroll there.
Q: How is this different from the payroll taxes Gusto already handles?
A: Gusto payroll handles the taxes tied to paying your team. Business Compliance covers what your business owes as a business, like Secretary of State registration, annual reports, and registered agent service.
Q: I'm already registered in my state. Do I still need this?
A: Registering is just the first step. Staying in good standing is ongoing. We keep you there by acting as your registered agent, watching your mail, filing your annual reports, and alerting you before deadlines.
Q: How much does Business Compliance cost?
A: $85 per state, per month, billed monthly. When you add a state, you are committing to 12 months of coverage in that state. It's included with Premium at no extra cost. State filing fees are charged at cost, and they vary by state and business type. One-time services are charged separately from your subscription. You'll see the price before you confirm.
Q: How do Business Compliance charges show up on my bill?
A: They appear on your regular Gusto invoice, not a separate bill. Your subscription, each one-time service you order, and state filing fees show up as their own charges, with the state named, so you can see what each one is for.
Q: I already paid for a one-time registration. What happens if I add Business Compliance?
A: Email your compliance concierge team at [email protected]. They'll review your account and share your options.
Expand the sections below to learn how to register for income, unemployment, and local tax in NY.
You'll work with the following New York agencies when registering for payroll taxes:
New York Department of Taxation and Finance: Handles income tax withholding.
New York Department of Labor: Handles unemployment tax.
You'll receive your account numbers and unemployment rates seven to ten business days after registering online.
To register for withholding income tax and unemployment tax:
To register for both income withholding and unemployment tax, go to the New York Department of Labor website.
If you're a non-profit, complete a NYS-100N form instead.
In the Agent C/O Address section, select No when asked if you want unemployment-related mail sent to your payroll provider.
If you withheld $100,000 or more in taxes last year, register for PrompTax. See the “Enter your tax account information later” section of this article for details on finding and entering your access code.
After you register with the New York Department of Labor, you'll also be registered with the New York Department of Taxation and Finance.
Once you complete the registration, enter your tax account information in Gusto.
Local taxes are paid to the state of New York.
New York City: Local taxes are based on where employees live.
Yonkers: Local taxes are based on where employees live and work.
Learn more about the local taxes and programs you may encounter below.
The MCTMT tax is based on the wages of employees working in the metropolitan commuter transportation district (MCTD) of New York City.
Gusto uses employees' work addresses to determine if this tax applies—if so, we'll withhold it automatically.
Your PrompTax access code must be entered in Gusto so that we can pay and file this tax for you.
If the tax is being withheld for someone who should not pay it, mark them as exempt.
Counties included in MCTMT
Bronx
Dutchess
Kings (Brooklyn)
Nassau
New York (Manhattan)
Orange
Putnam
Queens
Richmond (Staten Island)
Rockland
Suffolk
Westchester
Let us know if you’ve paid MCTMT before
When setting up your first employee in New York, you'll be asked if you've paid MCTMT before.
If you have: Mark Yes and enter the tax rate.
Gusto will withhold this tax using the rate entered for each applicable employee on every payroll.
You can get your rate from your previous provider, or use this agency resource to help.
If this is your first time: Mark No.
We will not apply the tax for the first quarter (because we do not know your rate), but we’ll figure out your rate based on your payroll, and apply it on future payrolls if needed.
If your payroll costs go over the limit in the first quarter, and you need to pay MCTMT, we’ll collect this by running a tax reconciliation payroll at the end of the quarter.
Payments and reporting
Your PrompTax access code must be entered in Gusto so that we can pay and file this tax for you.
We'll report the wages subject to this tax on the Employer's Quarterly Metropolitan Transit Tax Form (MTA-305). You can find this form in your Documents tab in your account.
You can see any MCTMT payments made by running an Agency Payments report in Gusto.
START-UP NY lets new and expanding businesses operate tax-free for 10 years near certain universities in New York. Learn more about the program.
Gusto does not formally support this program, but it can affect MCTMT payments and filings. If you apply for START-UP NY, or if an employee qualifies for it, contact us to make sure your account is set up correctly.
New York requires employers to provide disability insurance, family leave insurance, and workers' compensation coverage for employees.
In New York, employers need to provide disability insurance to cover employees if they get hurt or sick off the job. You can get this insurance through the New York State Insurance Fund (NYSIF).
You can also buy disability insurance through a company such as NEXT Insurance, but you'll need to pay them directly, and it's not automatically integrated with Gusto. You'll have to pay the insurance premiums once a year directly to your carrier.
Deduction and premium payment reminders
New York allows you to deduct a small amount from your employees' paychecks to help pay for this insurance. If you choose this option, Gusto will deduct the money from their paychecks and leave it in your company's bank account so you can pay the insurance provider.
Gusto will only deduct SDI money on regular payrolls, but not on off-cycle or bonus payrolls.
You'll need to handle the insurance payments and any required filings outside of Gusto.
Note: The SDI money Gusto deducts from employees' paychecks is left in the company bank account.
Set up SDI deductions in Gusto
To set up State Disability Insurance deductions:
Go to Taxes & compliance, then Tax setup.
Under New York Tax Setup, select Manage taxes.
Next to State disability insurance (SDI): Who will cover the cost—your company or your employees?, select Edit.
Choose if the company or the employee will pay for SDI:
The company will pay for SDI: No SDI amount will be deducted from your employees' paychecks. The company is responsible for covering the employee's portion of the insurance premium.
My employees will pay for SDI: We'll deduct $0.60 per week from your employees' paychecks to cover the cost. You need to pay the insurance outside of Gusto. The SDI amounts deducted from employee paychecks stay in the company bank account.
New York also requires employers to provide Family Leave Insurance (SFLI) for employees who need to take time off for certain family reasons. Contact your SDI carrier to learn how to add Paid Family Leave coverage.
Deduction and premium payment reminders
You can deduct money from your employees' paychecks to help pay for this insurance, up to a yearly limit. If you choose to do this, Gusto will deduct the money from their paychecks and leave it in your company's bank account so you can pay the insurance provider directly.
Gusto will only deduct SFLI money on regular payrolls, but not on off-cycle or bonus payrolls.
You'll need to handle the insurance payments and any required filings outside of Gusto.
Note: The SFLI money Gusto deducts from employees' paychecks is left in the company bank account.
The yearly limit for SFLI deductions can change.
Set up family leave deductions in Gusto
To set up family leave deductions:
Go to Taxes & compliance, then Tax setup.
Under New York Tax Setup, select Manage taxes.
Next to Paid family leave (PFL) insurance: Who will cover the cost—your company or your employees?, select Edit.
Choose if the company or the employee will pay for PFL:
The company will pay for PFL insurance: No PFL amount will be deducted from your employees' paychecks. The company is responsible for covering the employee's portion of the insurance premium.
My employees will pay for PFL insurance: We'll deduct the amount from your employees' paychecks to cover the cost. You need to pay the insurance premiums outside of Gusto. The PFL amounts deducted from employee paychecks stay in the company bank account.
In New York, most employers with one or more employees need to have workers' compensation insurance. You can get this insurance through:
A licensed private insurance agent or broker, like ERGO NEXT Insurance, which works directly with Gusto.
If you've already registered in the state, you need to enter your tax account details in Gusto. You need to be registered with one or more of the agencies below for us to file and pay taxes on your behalf:
New York Department of Taxation and Finance: Handles income tax withholding.
New York Department of Labor: Handles unemployment tax.
Local New York tax agencies: Handle various local taxes.
If you still need to register, refer to the applicable section earlier in this article.
Once you add a valid New York work address in Gusto for one or more employees, you can enter your state tax account information.
To add your New York tax account information:
Go to Taxes & compliance, then Tax setup.
Under New York Tax Setup, select Manage taxes.
Follow the instructions below for each tax type.
Important: 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.
Enter your New York State Identification Number. This is your FEIN plus two digits, also known as the NYS suffix.
Where to find your New York State Identification Number:
This is your Federal Employer Identification Number (FEIN) followed by a one- or two-digit location code called the NYS suffix.
If your number ends in 00, enter 00 at the end of your FEIN.
If your number has a single-digit suffix like 2, enter 02. This usually happens if you have multiple business locations.
Next, if you have a PrompTax access code, you need to enter it in Gusto so we can pay and file this tax for you
Where to find your PrompTax access code:
PrompTax is usually required if you withheld $100,000 or more in taxes last year. You'll receive the six-digit access code after registering for PrompTax. The New York Department of Taxation and Finance will let you know if you need to register for PrompTax to pay electronically.
Do not confuse the five-digit PIN you receive when you first register with the six-digit PrompTax access code.
If you're already registered for the PrompTax e-payment system, choose ACH Credit as your payment option and ZenPayroll, Inc. as your payroll provider.
If you do not know your code, contact the New York PrompTax Customer Service Center at (518) 457-2332.
Enter your Employer Registration Number for unemployment, assigned by the Department of Labor. This might be called a Business number on the New York Business Express site.
Where to find your Employer Registration Number:
You can find your Employer Registration Number on notices sent to you from the Department of Labor (DOL), like Form NYS-45. On the New York Business Express site, this might be called a Business number.
If it's seven digits, format it like this: ##-#####
If it's eight digits, format it like this: ##-##### #
Next, enter your UI Rate.
Where to find your unemployment tax rate:
You can find your unemployment contribution rate on the Notice of Unemployment Insurance Rate (Form IA 97) that the New York Department of Labor sends you each year.
Only enter your UI rate. Do not enter the Re-employment services fund or Total rate. Gusto will automatically add the re-employment services fund rate to the UI rate you enter. Combined, they are the Total rate.
If you do not have your rate yet, enter the new employer rate for New York in Gusto for now. Update the rate once you receive it.
If you do not know your rate, call the agency at (888) 899-8810.
Use this list to find New York's tax forms and where to view each one.
NYS-45 (Quarterly Combined Withholding, Wage Reporting, and Unemployment Insurance Return)
MTA-305 (Employer's Quarterly Metropolitan Transit Tax Form)
State W-2 (Wage and Tax Statement)
NY New Hire Report
To view these forms, go to Taxes & compliance, then Tax documents, and select the State tab.
NYS-1 (Return of Tax Withheld Payment Coupon)
To view these filings, sign in to the New York State agency portal.
To see what we've paid for you, run the Agency payments report.
Use this list to reach New York's payroll tax agencies by phone or website. It covers income tax withholding and unemployment insurance.
Phone numbers and links can change. If one does not work, search the agency's official website for the latest contact info.
Income tax withholding — New York State Department of Taxation and Finance (DTF): (518) 485-6654
Unemployment insurance — New York State Department of Labor (DOL): (888) 899-8810
We follow the rules from the New York Department of Taxation and Finance for reporting wages on employee Form W-2s.
Because of their guidelines, New York employees often see the same wage amount in Box 1 (federal wages, tips, other compensation) and Box 16 (state wages, tips, etc). This is correct, even if some wages were earned in other states.
You can find more details about how to report wages by worker type for New York State, New York City, and Yonkers on the agency's website.
Learn how to close or reopen tax accounts.