Your company may have to pay state and local taxes. Tax laws vary with the location and structure of the company, so you will have to consult state and local governments to learn about your tax obligations.
The two most common types of state and local tax requirements for small businesses are income taxes and payroll taxes.
Your state income tax obligations are calculated according to the structure of your company. For example, corporations are taxed separately from owners, while sole proprietors declare their personal and company income taxes on the same form.
If your company has employees, it will be your responsibility to pay state payroll taxes. They vary with the state, but usually include workers’ compensation, unemployment and temporary disability insurance. You may also have to withhold taxes on the employee’s income. Check with your state tax authorities how much you should withhold and when you should refer it to the state.