When you hire employees, several actions are required:
- You may need a Federal Employer Identification Number (EIN). Most businesses do, but you can find out for sure at the Internal Revenue Service EIN page. When you are ready to apply for the EIN, you can do it online with the IRS EIN form. If you do not acquire an EIN, then your Social Security Number (SSN) is used instead.
- Obtain a Missouri Withholding Number and an Unemployment Tax number. Complete the application for these numbers online or file form 2643 with the Department of Revenue and form 2699 with the Department of Labor and Industrial Relations.
- If you already have a Missouri Tax Identification (ID) Number, you can add withholding tax to your existing number by e-mailing the Department of Revenue at firstname.lastname@example.org or by calling (573) 751-5860.
Beginning with your first payroll, you must:
- Withhold state income tax and federal income tax at a percentage determined by salary and exemption information stated on the form W-4. See the Missouri Department of Revenue Missouri Employer Withholding site for questions about Missouri withholding. You can also link to the Internal Revenue Circular E, Employer's Tax Guide for information on federal withholding.
- Withhold 6.2% of the employee's salary for Social Security taxes.
- Withhold 1.45% of the employee's salary for Medicare taxes.
- Pay the Social Security and Medicare taxes to an approved banking institution on the 15th of the month.
File required payroll reports with the Department of Revenue and the Department of Labor and Industrial Relations on a quarterly and annual basis; and issue W-2 reports to employees at the end of the year.
Register for a Tax Identification Number and an Unemployment Tax Number
- If you plan to sell products or hire employees, you’ll need to register for several tax types. The Department of Revenue and the Department of Labor and Industrial Relations have provided a combined site, Online Business Tax Registration, which allows you to enter your information once and have it used for several registrations.
- If you are applying for a Missouri Retail Sales Tax License or Vendor's Use Tax License, your application can be processed, but a Sales/Use Tax bond is required before a license can be issued. For more information, see the Department of Revenue's page or, to compute the Sales Tax Bond, you can use the Department of Revenue's Sales/Use Tax Bond Calculator.
The Department of Revenue issues Sales Tax Exemption Letters to religious, charitable, civic, social, fraternal and service organizations.
For Out-of-State Contractors Doing Business in Missouri
- Out-of-state companies who temporarily transact any business in the state of Missouri are defined as transient employers and are required to register, file a bond, and remit withholding tax to the Missouri Department of Revenue. Form 2643T and Form 2643A will help you in this process.
- Should you have any questions pertaining to the Transient Employer License you may also contact their office by telephone at: (573) 751-0459 or by e-mail at email@example.com.
Sales/Use/Employer Withholding Tax
You are required to file a return even if you have no tax to report, unless you are registered as a "Seasonal Business" with the Department of Revenue. For more information, please contact the department at firstname.lastname@example.org. Department of Revenue Business Tax Forms has all of their reporting forms available online. You may also file your taxes online at Business Tax Electronic Filing.
Tax Issues & Concerns
Federal Employer Identification Number
As your business grows, you may need to have additional Federal Employer Identification Numbers. You can find out if you need an additional federal EIN at the Internal Revenue Service's EIN page. When you're ready to apply for the federal EIN, you can do it online at the IRS' EIN Form page.
The Department of Revenue offers a Business Tax Page that covers the registration, tax types and other related questions you might have. The Division of Employment Security also offers help with your questions about unemployment insurance.
Sales Tax Exemption Letters
The Department of Revenue issues Sales Tax Exemption Letters to religious, charitable, civic, social/fraternal, educational, Missouri political subdivisions and federal or Missouri state agencies.
Ending a Business
In the lifecycle of every business, there comes a time when the business ends. Even at the end of the business’s life, there are still several rules to comply with:
- To close your account(s) with the Missouri Department of Revenue, you will need to mark your last business tax return "FINAL", submit it to the mailing address indicated on your return/booklet and email your close date for each business tax type to the Missouri Department of Revenue at email@example.com.