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View Full Version : Where do they draw the tax line?


BennyM
Feb 11, 2009, 10:46 AM
Hi,

I have a tax question please; If a C Corp in Nevada takes an order (and payment) from a company in California for landscaping services, but hires a subcontractor based in Nevada to do the physical work needed in California, would the C Corp be subject to California taxation? In other words, would California require taxes paid by the C Corp when there's merely a job order and payment coming from California, even though the physical work was done by another company?

Thanks,
BennyM

MukatA
Feb 12, 2009, 12:33 AM
You are paying to the subcontractor, which must be reported on 1099-misc. The subcontractor is responsible for CA taxes as they are present in CA.
I do not think that the C Corp is subject to CA state tax.