I looked at a FedEx Ground route today that is based in the Bronx.

The route services Mt. Vernon and Yonkers NY.

I am wondering what my tax liability would be on $100,000 a year income.

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I do not know if it is better to form an S-corp in NY or NJ. (FedEx does not allow LLCs).

I do not know if I would be responsible for NYC taxes since the terminal is in the Bronx.

I do not know if I would be responsible for the MTA tax due to Westchester County.

I do not know if I would be responsible for the Yonkers tax, since some of the stops occur within its limits.

Ultimately I'd like to know which taxes I would be responsible for and add what percentages given a $100,000 annual income.

Thanks in advance

:”I do not know if it is better to form an S-corp in NY or NJ. (FedEx does not allow LLCs).”------> "S Corp or LLC?" is a common question for new business owners. Unfortunately, this question is tricky to answer in a satisfying way unless you learn a little tax law. But the question is easy to answer once you do understand a wee bit of tax law. Here's the first thing you need to know: An S corp isn't actually a corporation. Rather, an S corp is an entity that's made an election with the IRS to use a set of tax accounting rules detailed in Subchapter S of the IRC. An LLC is a chameleon for income tax purposes, so it can be anything the owner wants it to be. For example, an LLC with one owner can be a sole proprietorship, a C corpor or an S corp. And an LLC with multiple owners can be a partnership, a C corp or an S corp.What all of the foregoing means is that you actually don't need to choose between an LLC and an S corp. You can form an LLC and have the LLC treated as an S corp. And this means the "LLC or S corp" question is, well, nonsensical.I guess yo can talk to a biz attorney for more info in detail in choosing either LLC or S corp in NYS or NJ.
“I do not know if I would be responsible for NYC taxes since the terminal is in the Bronx.I do not know if I would be responsible for the MTA tax due to Westchester County.I do not know if I would be responsible for the Yonkers tax, since some of the stops occur within its limits.Ultimately I'd like to know which taxes I would be responsible for and add what percentages given a $100,000 annual income.”----->As there is no reciprocal agreements between NJ and NYS, you , as a full year redinet of NJ, MUST pay tax on your NYS source income that yu earn in NYS and on your NJ return you can claim tax credit on your NYS tax. You are allowed to take credit on your NJ tax for the income taxes you paid in NYS. As you live in NJ, you do NOT have to pay NY city income taxes, which are pretty hefty. That, by itself, MORE than pays for any commuting costs involved. due to a credit given by NJ for the NY STATE income taxes paid, you will pay ZERO NJ taxes on your NY-based income. If that NY-based income is your only source of income, you will have to file a NJ return, but NO taxes will be due ; the General Corporation Tax for NYC is imposed on all domestic and foreign corporations that are d oing business/ maintaining an office. in NYC.

I think I am getting the hang of this.

As a NJ resident, owning a business in NY I only have to pay NYS income taxes and I am allowed to use that paid tax as a credit against my NJ return.

It looks like my NYS taxes would be $1,946 plus 6.45% over $40,000.

Using $100,000, it would be $3,840 + $1,946 = $5,816 due to NYS.

It appears as though non-Yonkers residents pay .05%, or $500 in this scenario. I still haven't been able to determine if this is due, since the terminal is in the Bronx and only some of the stops are in Yonkers.

Regarding the NY MTA tax, I found this:

As a one man operation, I would think I would be making quarterly estimated tax payments and not be liable, as there would be no "withholdings".

Finally, a NY vs NJ corporation. If I incorporate in NJ, but produce 100% of my income in NY, I'd still owe the $500 minimum NJ corporate tax. Perhaps incorporating in NY is cheaper?

Any other ideas or thoughts are of course welcome.

“As a NJ resident, owning a business in NY I only have to pay NYS income taxes and I am allowed to use that paid tax as a credit against my NJ return.”-----------> Agreed;as described previously, since there is NO reciprocal agreements between NJ and NYS, you need to file your NYS return as a NON-resident of NYS. And you , to claim your NYS tax paid to NYS on your NJ return, need to file yur NJ return as a full year resident of NJ.

“It looks like my NYS taxes would be $1,946 plus 6.45% over $40,000. Using $100,000, it would be $3,840 + $1,946 = $5,816 due to NYS.It appears as though non-Yonkers residents pay .05%, or $500 in this scenario. I still haven't been able to determine if this is due, since the terminal is in the Bronx and only some of the stops are in Yonkers.”--------->You need to contact your tax pro for more accurate info on your tax liability in NYS/NYC. NYS imposes a corporate income tax on both regular and S corps that do business in the state. In NYS, you're generally free to choose to operate your business as a C corp, S corp, partnership, LLC, or sole proprietorship. However, the entity type you select for your biz determines what type of fees and taxes you and your business pay for your business and on your business income,OK???? If youe biz is an S corp , then, NYS imposes a franchise tax on S corps. New York S corps are required to pay the fixed dollar minimum tax, ranging in amount from $25 to $4,500 based on the amount of NYS gross receipts. For foreign authorized S corps, if the total of fixed dollar minimum tax according to the schedule is less than $300, then the tax payment must be increased accordingly to satisfy the $300 annual maintenance fee requirement. If your biz conducts business in another than the state in which it was incorporated, you'll need to determine what qualifications or registrations are required by the other state. NYC has two extra taxes on income. First, S corps (as well as C corps) are subject to full corporate income tax at an 8.85% rate. Second, most unincorporated businesses (including sole proprietorships, LLCs and partnerships) pay an unincorporated business tax (UBT) at a 4% rate. NYC income tax is based on NYS taxable income, which is gross income less NYS tax deductions. There are no deductions specifically for NYC income tax.


Regarding the NY MTA tax, I found this:


Quote:
If you are an employer who is required to withhold New York income tax from wages you pay, you are required to pay the MTSA mobility tax. However, the amount of payroll expense you pay must exceed $2,500 during any quarter of the year before the tax is required.”---------->I guess this provision is NOT for you as yu have no EE in NYS.I guess it depends on the situation; the MCTMT is a tax imposed on certain ERs and self-employed individuals engaging in biz within the metropolitan commuter transportation district. It is a sort of excise tax that can not be deducted on your federal return.


“As a one man operation, I would think I would be making quarterly estimated tax payments and not be liable, as there would be no "withholdings". ----->correct; you do NOT need to withhold any NYS income tax as you said, y9u have no NYS resident EE in your biz in NYS, however, you need to pay quarterly estimated taxes to NYS/IRS.

“Finally, a NY vs NJ corporation. If I incorporate in NJ, but produce 100% of my income in NY, I'd still owe the $500 minimum NJ corporate tax.”------> An out-of-state corporation doing business in a state other than the one in which it is incorporated ( I mean a company that is going to do business outside of its state of formation) must register to do so as a foreign qualification. When you foreign qualify a business, you register for a certificate of authority in NYS where your company will be transacting business, and pay the necessary state fees.SO, when evaluating whether to form your business as a corporation or LLC in a state other than one where you are transacting business, keep in mind that your business will be subject to ongoing reporting requirements, fees and taxes in both your state of formation and state of qualification. If your business is expanding into new state and you need to qualify it as part of this growth, these initial and ongoing fees should be considered a necessary part of doing business. Many factors are used to determine whether a company is transacting business in a state, and therefore needs to foreign qualify. Some of the common criteria evaluated include whether the company has a physical presence in NYS;has employees in NYS;accepts orders in NYS; has a bank account in nYS or etc. While you may consider the extra fees and reporting requirements to be troublesome, the consequences of not foreign qualifying your business could be much worse. First, you could lose access to that state's court system. For example, if an employee or customer within a state in which you are transacting business sues your company, you would not be able to defend the lawsuit in that state's courts, because your company is not recognized as a business there. In this example, your company typically would be given time to undertake the qualification process in order to allow you to defend such a lawsuit. So you'd end up having to foreign qualify anyway. In addition, the company could be subject to fines, penalties and back taxes for the period of time in which your company transacted business within that state.
“ Perhaps incorporating in NY is cheaper?”-------------->I guess it is hard to tell, it depends as said above; you may contact a biz attorney for more accurate info in detail.