Answers

Foreign registration when using an employee leasing company

Asked by: Adrian  — 2 May, 2012

We incorporated in DE and are registered as a foreign corporation in FL. We have three employees, all of which are employed via an employee leasing agency (so the FEIN on their W2 is the employee leasing company). Each employee works from home with one in FL, one in NY and one in IL.
Do we need to register as a foreign corp in NY and IL? Also sales tax in each?

Answered by: admin  — 2 May, 2012

Adrian,

Technically those are not your employees but those of the agency what officially employs them. As far as I see you hire the services of that agency, and those services are then provided to you by this agency’s employees.

As such it only makes sense to assume that your company has no nexus in NY or IL, and therefore doesn’t need to register to collect sales tax or form a foreign entity in those states.

With that being said, since I am not familiar with specifics of the laws in New York and Illinois regarding what would constitute “nexus” and what wouldn’t, so its a good idea to consult attorneys licensed in NY and IL. I would suggest you to consult our contributor on law related questions Roman Fichman Esq. (see his ad on the right), since he is licensed in NY, and he would be able to advise you further.

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