Pay employees in different tax jurisdictions
About paying employees in multiple tax jurisdictions
With Square Payroll, you can set up locations spanning multiple states and localities and leave the tax calculations to us. You can also add work locations for employees who work from home to make sure that you correctly pay unemployment tax to those employee's home states.
Square Payroll supports payroll tax calculations and filings across all 50 states and the District of Columbia.
Before you begin
You can adjust team member work addresses and update your tax information from your Square Dashboard. Before you adjust this information, make sure you have all your business addresses added to your Square Payroll account. Learn how to update taxpayer address for Square Payroll
Square Payroll currently supports W-2 employers in adding new or existing work locations across local or state tax jurisdictions and paying W-2 employees in those locations with the correct taxes calculated, withheld, and remitted to the correct state agency.
Square Payroll does not support the following features or methods regarding multiple tax jurisdictions:
Paying one employee that works in multiple tax jurisdictions.
Courtesy withholding for employees.
Support for withholding, paying, and filing taxes for multiple EINs under one Square Payroll account.
Closing a business location in one tax jurisdiction and opening in another jurisdiction with the same EIN.
Step 1: Update your team member’s work address
If you have team members in different tax jurisdictions, make sure you added each of them with the correct work address. To update a team member’s work address:
Sign in to your Square Dashboard and select Staff & payroll > Team.
Select a team member to open the team member panel and select Payroll.
Select Employment and go to Work address.
Select an existing address.
Select Next to save the information.
You can view each tax filing that Square Payroll files on your behalf in your Tax forms in your Square Dashboard, and you will receive notifications once your monthly, quarterly, or annual tax filings are posted to your account. You can also view the taxes Square Payroll remits on your behalf in the withdrawal summary of each payroll run, on your team’s paystubs, and in your Square Payroll reports.
Step 2: Update your tax information
In your Square Dashboard, go to Staff & payroll > Payroll > Tax info.
Add your state tax account numbers and unemployment insurance rate to the additional locations or jurisdictions you'll process payroll in. You must provide the state tax information for your business’ additional locations or you won’t be able to process payroll for employees in those states.
Select Save.
For each state or tax jurisdiction that you process payroll in, Square Payroll will remit your tax payments and complete your tax filings to the applicable tax agency on your behalf. This is in addition to the federal tax payments and filings that Square Payroll will remit on your behalf to the IRS.