Payroll Nevada: Employer Tax and Software Guide
Nevada payroll for employers: no income tax but a 1.17% Modified Business Tax, the $43,700 unemployment base, daily overtime, and 10 providers compared.
Nevada Payroll: The Employer Guide
No state income tax, an employer excise tax most people have never heard of, the highest unemployment wage base in the region, and how 10 payroll providers price the work
Nevada has no state income tax, and the prohibition sits in the state constitution rather than in a statute that a future legislature might quietly amend. For an employer, that removes an entire layer of work: no state withholding calculation, no state W-4, no quarterly withholding return.
It also creates the most expensive misconception in Nevada payroll. No income tax does not mean no payroll tax. Nevada charges employers a quarterly excise tax on wages that many owners never hear about until a notice arrives, runs the highest unemployment wage base in the western United States at more than six times California's, requires workers compensation from the very first employee with fines up to $15,000 for going without, and is one of only four states with a daily overtime rule.
This guide covers what Nevada actually requires, where the rules bite hardest, and how 10 payroll providers price the work at 5, 15, and 50 employees.
No income tax is not the same as no payroll tax
Three state-level obligations sit on top of federal payroll in Nevada. None of them is income tax withholding, and all three are paid by the employer rather than deducted from employees.
Modified Business Tax
A quarterly excise tax on wages under NRS 363A and 363B. For general business employers the rate is 1.17 percent on gross wages after deducting employer-paid health benefit costs, with the first $50,000 of quarterly wages exempt. Financial institutions and mining businesses pay 1.554 percent from the first dollar with no exemption at all.
| Employer type | Rate | Quarterly exemption | Notes |
|---|---|---|---|
| General business | 1.17% | First $50,000 of wages | Health benefit costs paid by the employer are deductible first |
| Financial institutions | 1.554% | None | Taxed from the first dollar of wages |
| Mining businesses | 1.554% | None | Same treatment as financial institutions |
| Below the exemption | No tax | Applies | A return must still be filed every quarter |
Two things trip employers up here. The first is the rate itself: many vendor pages and older guides still publish 1.378 percent, which was reduced to 1.17 percent effective July 1, 2023 after a Nevada Supreme Court ruling. The second is that a return is required every quarter even when no tax is due, including quarters where wages fall below the $50,000 threshold. Registering with the Employment Security Division for unemployment automatically creates the Modified Business Tax account, so most employers have one whether they realize it or not.
Unemployment insurance
Paid entirely by the employer, with nothing withheld from employees, and administered by the Department of Employment, Training and Rehabilitation. The taxable wage base is recalculated annually at two thirds of the average annual wage for Nevada workers, which is why it climbs every year and why it sits so far above the federal floor.
| Item | 2026 figure | Notes |
|---|---|---|
| Taxable wage base | $43,700 | Up from $41,800 in 2025, effective January 1 |
| New employer rate | 2.95% | Retained roughly 14 to 17 calendar quarters |
| Experience-rated range | 0.25% to 5.40% | Assigned annually and posted to the employer self-service portal |
| Career Enhancement Program | 0.05% | Surcharge added to all employers on top of the assigned rate |
The wage base deserves attention because it is genuinely unusual. At $43,700, a Nevada employer pays unemployment tax on more than six times the wage volume that a California employer does, since California still uses the $7,000 federal minimum. At the new employer rate, the maximum annual cost approaches $1,300 per employee. Our guide to state unemployment tax covers how this compares nationally.
Workers compensation
Mandatory from the first employee with no small employer exemption. An employer without coverage faces an administrative fine of up to $15,000 and may be ordered to close until insurance is obtained. This is not a payroll deduction and it does not run through the payroll system, but it is a state requirement that attaches the moment the first person is hired.
Where Nevada gets strict: wages, tips, and the eight-hour day
The tax side of Nevada is light. The wage and hour side is not, and two rules in particular catch employers arriving from other states.
A flat minimum wage with no tip credit
The minimum wage is $12.00 per hour for every employee, and Nevada does not permit a tip credit at all. Tipped workers receive the full $12.00 in cash wages and tips sit on top. Ballot Question 2, approved by voters in November 2022, also eliminated the previous two-tier structure that set different minimums depending on whether the employer offered qualifying health benefits.
In a state where hospitality and gaming employ a large share of the workforce, this is the single most consequential wage rule. An operator moving from a tip credit state and configuring payroll on the old assumption underpays every tipped employee from day one. Our guide to the tipped minimum wage covers how the credit works where it is allowed.
Daily overtime under NRS 608.018
Nevada is one of only four states with a daily overtime requirement, and its version is unusual because eligibility depends on the employee's hourly rate rather than on job duties alone.
| Employee hourly rate | Overtime trigger | Basis |
|---|---|---|
| Under $18.00 | After 8 hours in a workday, and after 40 in a week | 1.5 times the minimum wage threshold under NRS 608.018 |
| $18.00 or more | After 40 hours in a week only | Standard federal FLSA rule applies |
| Written 4-10 agreement | After 10 hours in a workday | Employee may agree in writing to a four-day, ten-hour schedule |
The workday is a rolling 24-hour period beginning when the employee first starts work, not a calendar day, which matters for anyone running split or overnight shifts. And because the threshold is set at 1.5 times the minimum wage, it moves automatically whenever the minimum wage moves. If Nevada's minimum rises above $12.00, the daily overtime threshold rises with it and the set of employees covered changes without any action by the employer. Our guide to overtime rules covers the calculation mechanics.
10 payroll providers for Nevada employers compared
Every provider below files Nevada unemployment. The differences that matter here are whether the platform handles the Modified Business Tax return, whether daily overtime is computed correctly, and whether the price is published at all.
| Provider | Best For | Starting Price | Pricing Model | NV Filing | Multi-State Included | Onboarding Tools | Trial |
|---|---|---|---|---|---|---|---|
| OnPay | All-in pricing, every state | $49 + $6/ee | Base + PEPM | 1 month | |||
| Gusto | First payroll purchase | $49 + $6/ee | Base + PEPM | Until 1st run | |||
| Patriot | Lowest cost, single state | $37 + $5/ee | Base + PEPM | 30 days | |||
| QuickBooks | Books already in QuickBooks | $50 + $6.50/ee | Base + PEPM | 30 days | |||
| SurePayroll | Micro and household employers | $29 + $7/ee | Base + PEPM | Varies | |||
| Square | Casinos, bars, and restaurants | $35 + $6/ee | Flat + PEPM | Free trial | |||
| Paylocity | Growing past 50 employees | Quote | Quote | Demo | |||
| ADP RUN | Compliance depth under 50 staff | ~$79 + $4/ee | Quote | 3 months | |||
| Paychex Flex | A person to call about a notice | Quote | Quote | Varies | |||
| Rippling | Payroll tied to HR and IT | $35 + $8/ee+ | Modular PEPM | Demo |
OnPay
One plan at $49 per month plus $6 per employee with every feature included and no tiers to climb. Tax filing covers all 50 states with no multi-state surcharge, useful for a Nevada employer with staff across the California, Arizona, or Utah lines. Year-end W-2 and 1099 filing is included and the first month is free without a credit card.
Gusto
The most common first payroll purchase for US small businesses. Tax filing is automatic, pricing is published, and the Simple plan runs $49 per month plus $6 per employee after a March 2026 base increase. The onboarding and benefits tooling is the strongest among the payroll-first providers.
Two Nevada-specific notes. Simple covers single-state payroll only, so one California hire moves the account to Plus at $80 plus $12 per employee. And time tracking sits behind Plus as well, which matters more here than elsewhere given the daily overtime rule.
Patriot Software
The cheapest legitimate full-service payroll at $37 per month plus $5 per employee, covering federal and state filing plus new hire reporting. Basic at $17 plus $4 calculates only and leaves depositing and filing to the employer, which with two separate Nevada agencies to satisfy is a poor trade for most owners.
Additional state filings cost $12 per month each. For a single-state Nevada business under 20 people, nothing else comes close on cost.
QuickBooks Payroll
Core runs $50 per month plus $6.50 per employee with full-service tax filing on every tier, following a per-employee price increase across the Workforce plans on July 1, 2026. The argument for it is unchanged: if the books already live in QuickBooks Online, payroll entries land in the general ledger without an export step.
SurePayroll
Owned by Paychex and aimed at very small and household employers at roughly $29 per month plus $7 per employee. The distinguishing feature is a flat $9.99 monthly multi-state fee regardless of how many states are involved, which beats per-state pricing for anyone in three or more.
Square Payroll
Full-service payroll at $35 per month plus $6 per person paid, with tax filing included. For a Las Vegas or Reno restaurant, bar, or retail business already running Square point of sale, hours and tips flow into payroll with nothing to configure. Given that Nevada allows no tip credit and requires daily overtime tracking, having hours and tips arrive automatically removes two of the more error-prone manual steps.
Paylocity
A full HR and payroll platform aimed above the smallest end of the market, with strong multi-jurisdiction handling and a well-regarded self-service experience. For a Nevada company crossing 50 employees or operating in several states, it becomes a reasonable candidate. Pricing is quote-only.
ADP RUN
The deepest compliance operation in the category, which in Nevada means the Modified Business Tax return and the daily overtime calculation are routine work rather than configuration projects. Third-party estimates put the Essential tier near $79 per month plus $4 per employee, but ADP does not publish rates and most buyers report paying more once add-ons land.
Paychex Flex
A service relationship rather than a software subscription, with a named contact at higher tiers. Pricing is quote-only, and quarterly administrative charges are a recurring theme in customer reports. The Nevada argument is specific: when a wage comparison deficiency notice arrives from the Department of Taxation, having someone to call is worth real money.
Rippling
A unified employee record where payroll, HR, and IT provisioning share one data model, starting at $35 per month plus $8 per employee for the core platform with payroll as a separate module. Real configurations land well above the headline figure. Time tracking is native rather than bolted on, which is a genuine advantage under Nevada daily overtime, but the platform is overbuilt for a small single-location business.
What each provider actually costs a Nevada employer
The table below models published software rates at three headcounts plus what happens when a second state enters the picture, which for a Nevada employer usually means California or Arizona.
| Provider | 5 employees | 15 employees | 50 employees | 2nd State Cost | Notes |
|---|---|---|---|---|---|
| Patriot Full Service | $62 | $112 | $287 | $12/mo per extra state | Cheapest single-state option |
| SurePayroll | $64 | $134 | $379 | $9.99/mo flat | Micro-employer focus |
| Square Payroll | $65 | $125 | $335 | Included | Strong for hourly and tipped staff |
| OnPay | $79 | $139 | $349 | Included | No tier to climb |
| Gusto Simple | $79 | $139 | $349 | Forces Plus tier | A California hire changes this |
| QuickBooks Core | $83 | $148 | $375 | Fee per extra state | General ledger sync |
| ADP RUN Essential | ~$99 | ~$139 | ~$279 | Quote | Quote-only above Essential |
Worth keeping in proportion: the software subscription is the smaller number. A 15-person Nevada payroll costs somewhere between $112 and $148 per month in software, while unemployment insurance alone at the new employer rate on a $43,700 base runs into the thousands annually across the same headcount, before the Modified Business Tax and workers compensation premiums. Optimizing the subscription is worth doing, but not at the cost of a provider that mishandles the state obligations. For a wider view, see the payroll software for small business comparison and the payroll pricing guide.
Choosing a payroll provider for Nevada
Four questions separate providers that will work here from providers that will generate notices.
Beyond the payroll engine, Nevada requires new hire reporting and mandatory workers compensation from the first employee. The Nevada HR compliance guide covers the surrounding employment law and new hire reporting covers what the report must contain.
Before you choose
FirstHR does not process payroll, file payroll taxes, or administer benefits. Every provider above does something we do not, and if payroll is the problem you are solving, one of them is your answer.
What we handle is the layer underneath. Nevada has no state W-4 to collect, which removes one form, but the rest of the onboarding paperwork still has to happen before anyone can be paid correctly: the I-9, the federal W-4, a signed direct deposit authorization, and confirmation that workers compensation coverage was in place before the first shift. FirstHR covers onboarding workflows, e-signatures, document collection, and employee records for US teams of 5 to 50 people at a flat $98 to $198 per month. If the recurring failure is paperwork arriving late or unsigned rather than the tax math, that is a different problem than payroll processing, and it is the one we built for.
Frequently Asked Questions
Does Nevada have a state income tax?
No. The prohibition sits in Article 10 of the Nevada Constitution rather than in statute, so changing it would require a constitutional amendment passed in two consecutive legislative sessions and approved by voters. There are no local income taxes either, and consequently no state withholding calculation and no state W-4.
What is the Nevada Modified Business Tax?
A quarterly employer excise tax on wages. General business employers pay 1.17 percent on gross wages after employer-paid health benefit deductions, with the first $50,000 per quarter exempt. Financial institutions and mining businesses pay 1.554 percent from the first dollar. A return is required every quarter even when no tax is due.
What is the Nevada unemployment wage base?
$43,700 per employee for 2026, up from $41,800, recalculated annually at two thirds of the state average annual wage. New employers pay 2.95 percent and experience-rated employers fall between 0.25 percent and 5.40 percent, with a 0.05 percent Career Enhancement Program surcharge on top.
Does Nevada allow a tip credit?
No. Tipped employees must receive the full $12.00 minimum wage in cash with tips on top. Ballot Question 2 in November 2022 also eliminated the previous two-tier minimum that varied with health benefit offerings, leaving one flat rate for all employees.
What is Nevada daily overtime?
Under NRS 608.018, employees earning less than 1.5 times the minimum wage, meaning under $18.00 per hour in 2026, are owed overtime after 8 hours in a rolling 24-hour workday in addition to the weekly 40-hour trigger. Employees at or above $18.00 per hour follow the federal weekly rule only.
Is workers compensation mandatory in Nevada?
Yes, from the first employee with no small employer exemption. An employer without coverage can be fined up to $15,000 and ordered to close until insurance is obtained, under NRS 616D.200 and NAC 616D.345.
What changed for Nevada employers this year?
The Department of Taxation resumed quarterly wage comparison on January 1, 2026, cross-referencing Modified Business Tax returns against unemployment wage filings and issuing automatic deficiency determinations on mismatches. The unemployment wage base also rose to $43,700 and MBT filing moved to the My Nevada Tax portal.
How much does payroll software cost for a Nevada small business?
At 5 employees, published July 2026 rates run roughly $62 for Patriot Full Service, $64 for SurePayroll, $65 for Square Payroll, $79 for OnPay or Gusto Simple, and $83 for QuickBooks Core. At 50 employees the same plans land between $287 and $375, excluding unemployment insurance, Modified Business Tax, and workers compensation premiums.