Company Tax

The article provides guidance on managing company tax information within BambooHR. It outlines the necessary federal and state tax details required for payroll and offers a structured approach to add, edit, or remove tax accounts. Users can navigate to the Payroll section in Settings to access tax management features, including adding new tax rates and understanding tax frequencies. The article emphasizes the importance of verifying tax IDs and compliance with local regulations. It also informs users about potential fees for missing tax IDs and the need to register new tax accounts when hiring employees in different states. Additionally, it highlights unsupported tax types and provides resources for further assistance.

  • Jul 8, 2026
  • Knowledge

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Company Tax
Article Text
Company Tax is part of Payroll that is an add-on feature.

How do I manage my company's tax information in BambooHR?

Purpose: Payroll requires federal and state tax information. This help guide will show you how to manage your tax information within BambooHR.

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Table of Contents:

BambooHR will collect and remit tax payments on your behalf. Please note that you are responsible for verifying that tax IDs, pay frequencies, and rates are correct.

Did you know we have a BambooHR Learning course about company taxes in BambooHR? Click here to learn more about what is included in this course.

Taxes in Settings

Go to Payroll in Settings and select Taxes.

On this page, you can add, search, and filter your company taxes. Tax ID, tax rates, and pay frequencies are assigned to companies by the IRS and states. Some states also require third-party access (TPA) or a Power of Attorney (POA). Enter federal and state tax IDs here to process and ensure TPA or a POA is complete for required accounts. Taxes missing any of this information will appear under the Tax Set Up section. Once you add the necessary tax information, the tax account will move to the Taxes section.

By default, the table shows active taxes. Adjusting the filter lets you see all taxes, including active, ended, and voided taxes. If you have multiple Employee Identification Numbers (EINs), taxes will be displayed below the applicable EIN.

Status Definitions in Tax Set Up

The following statuses may appear in BambooHR when navigating to Settings > Payroll > Taxes > Tax Set Up. These are related to the individual tax account setup and will notify you of missing information or tax filing status.

  • ! Pending access confirmation: If you have completed the steps outlined in the Tax Filing Access section of the tax setup, you have checked the acknowledgment box, and BambooHR is awaiting access confirmation from the state, this status will appear. Click on the Review Status button to view the status of this process.
  • ! Fees apply in 7 days: You will have 60 days from when the tax account was added to apply and add the tax account ID (see below). This status will appear on the 53rd day and warn you that fees will incur in 7 days if the tax account ID has not been added.
  • ! Fees apply: This status will appear after the 60th day of not adding a tax ID for the tax account. If you have applied for the ID but are waiting on the state, please reach out to Payroll Support to avoid fees.

Company Tax Settings

A gear dropdown menu will appear in the right corner of the Taxes page in Payroll Settings. Clicking that gear, then selecting Company Tax Settings will pop up a modal where you can adjust the following company-level tax settings for both state and federal taxes:

State:

1.Ohio Courtesy Withholdings: If your company is subject to payroll taxes in the state of Ohio, BambooHR will collect and report local courtesy withholdings from employees each pay period by default. If you choose not to support the courtesy withholdings for employees, you may suppress this by selecting No, do not collect Ohio courtesy tax based on employees location.

Federal:

2.Display Employer-sponsored health coverage (Box 12DD) on W-2s: By default, the option Show employer-sponsored health coverage on W2s will be selected. You have the option to choose if you want BambooHR to report the employer-sponsored health coverage amounts on your employee's W-2 if you have less than 250 employees. If you have more than 250 employees, you will not have the option to hide this amount as it is federal tax law to report these on the W-2 with that many employees.

3.How will you file for contractors?:If you are a BambooHR Payroll customer and have contractors, you can select whether you would like BambooHR to print and mail your contractors their 1099s on your behalf. By default, the I will file, print, and mail my own 1099 option will be chosen, as BambooHR charges a small fee for this service.

Changes made to W-2s or 1099s will be applied the following year. For example, if you opt-in to have BambooHR print and mail your 1099s in January of 2024, this will take effect in 2025. These settings will not retroactively apply to the 2023 1099s. If you would like to adjust these settings for the previous year, please contact our Payroll Support team.

How do I add a company tax?

Please note some tax accounts have unique rules and thresholds before they can be applied (i.e. WA FMLA) and we advise you consult your local tax authorities and in-house accounting advisors to ensure your setup is compliant and accurate.

Click Add Tax from the company tax page. On this page, you will fill out the following information:

  1. Select EIN*: If you are processing payroll for multiple companies through BambooHR, you will need to select which EIN this tax is associated with in the dropdown menu.
  2. Effective Date: This is the date that payroll will first use the new tax. The Effective Date drop-down list only allows you to select quarter start dates. Only future quarters will appear, so you can pick any quarter up to a year in advance for your tax to start.
  3. State and Tax Type: When selecting a state, the Tax Type drop-down list will change to only display taxes applicable to the state you selected.
  4. Do you have a Tax Account ID?:If you select "No", a link to the state's tax registration website will appear with some info on what you will need handy to quickly apply for the ID. You are required to check that you have already applied and are waiting for the ID before saving the tax account.
  5. Tax Account ID: State tax IDs must apply to the state where the tax is owed. If you add a tax and are waiting for a tax ID, a modal will appear when you click Save, informing you of when you need to enter a tax ID before receiving a fine*.
  6. Tax Account ID help icon:If you need help finding the right tax ID number or figuring out how to format your tax ID, click on the help icon. We will tell you which formats are acceptable for that specific tax so you know what to look for.
  7. Tax Deposit Frequency:The selected tax type will change the options in the tax deposit frequency drop-down list. In the case of some taxes, you cannot change the pay frequency because the specific tax only allows one pay frequency.
  8. Tax Rate - Tax rates are related to unemployment taxes. A New Employer tax rate is entered for unemployment tax until a rate is assigned. Click here to find the New Employer tax rate for your state. Keep in mind, when entering a tax for State Unemployment Insurance, the tax rate field has a minimum and maximum amount that you can enter. BambooHR will limit both the minimum and maximum tax rates that you can enter.
  9. Tax Filing Access: Some tax accounts require third-party access (TPA) or a Power of Attorney (POA). If you are setting up a tax account that requires one of those, this section will appear here. Please note this section will be grayed out until you add your Tax Account ID. Once the Tax Account ID has been added, instructions for how to set up TPA or a link to the POA will appear for you to complete. You will also have to check the box to acknowledge you are responsible for setting up this access before saving the tax account.

*Please note that fees apply if the tax ID has not been entered within 60 days. A $100 fee will apply for each state missing a Tax ID 60 days after the first payroll run and every 60 days afterward until the tax ID has been entered into BambooHR. A reminder notification will send weekly as a reminder to follow up and get this information entered.

Check out this help guide to get help with finding your company tax information.

Tax frequencies defined

Tax Frequency options vary state-to-state. Below are common tax account frequencies and their definitions:

  • Weekly: Tax deposits are required to be made every week, typically covering payroll taxes accumulated during that week. This option is generally mandated for employers with a large tax liability or based on certain state or local tax regulations.
  • Monthly or Monthly Due 15th: Tax deposits are made once a month, typically by the 15th day of the following month. Employers who have a smaller tax liability often qualify for monthly deposit schedules.
  • Semi-Weekly: Tax deposits are made twice a week, usually on Wednesdays and Fridays. Employers with higher tax liabilities typically follow this schedule. Payments cover taxes accrued from certain days of the week up to the deposit date.
  • Semi-Monthly: Tax payments are due twice a month, generally on specific dates such as the 15th and the last day of the month. This schedule is less common for federal tax deposits, but may apply for certain state or local taxes depending on the jurisdiction.
  • Quarterly: Tax deposits are made four times a year, corresponding to calendar quarters (e.g., January-March, April-June). This is common for smaller, less frequent tax payments or certain state or local taxes.
  • Annual: Tax deposits are made once per year. This is typically reserved for small employers or special cases.

There are some unique frequencies specific to each state and tax type listed below. Please visit the state's revenue department for further information:

Alabama

Colorado

Connecticut

  • Weekly - Connecticut State Tax

Delaware

Indiana

Kansas:

Massachusetts

Maryland

New Hampshire

New York

Would you like to watch a video about this topic?
How do I make changes to a tax?

If you receive a new tax rate notice from a state you're registered in, you will need to update the tax information in BambooHR to reflect the changes. Keeping your state taxes up to date in BambooHR ensures that taxes are filed and paid timely. If an unemployment rate has changed, end the existing record and add a new one with the effective date of the change. Likewise, if you create a new tax by mistake, you can remove that tax and it will no longer appear.

To update tax information, hover over the tax you want to change and click on the action menu on the right. Then, select the applicable option from the list.

If you need to make changes to a federal tax, you must reach out to our Tax Admin team to process this request. Don't worry, we've made it easy. Click on the gear icon next to the federal tax and fill out the modal to get in contact.

Keep in mind you are responsible for providing the correct tax frequency and failure to do so may result in penalty. For more information on how to determine your correct federal deposit frequency, click here!

Add new rate

Click on the action menu (three dots) for which individual tax you need to enter a new rate and select Add New Rate. The Add New Rate page only allows you to edit the effective date, pay frequency, and tax rate.

End on

If you are no longer required to pay taxes in a state, you must use the End on option to end the tax. This option allows you to pick a quarter when the tax is no longer in use. You should keep the tax active through the end of the year to allow for year-end reporting/filing. You can also remove the End on date if there is no future rate added. The option will only display for taxes with the most future date to prevent overlapping dates from being selected when adding a future date.

Edit

You can edit the tax rate anytime during the first quarter that a tax is effective. After the first quarter, you cannot edit the tax rate, and you should add a new rate instead of editing the existing rate.

If you have received a tax ID that you have been waiting for and need to add the ID to a tax, you can use the Edit feature to add the ID and save it.

Remove

When setting up your company taxes, the setup of a tax may be incorrect. The Remove option is available for such cases when you need to remove a tax altogether. If a tax type has not been used in a payroll run and removed, the tax no longer displays in the list of active or inactive taxes. If it has been used in payroll and removed, the tax marks as void.

Tax account banners

A single banner will display at the top of the Taxes page within Settings > Payroll > Taxes if BambooHR finds any discrepancies with your tax account setup. The banner will display the highest priority message, but keep in mind to review each individual tax within the Tax Set Up section as you may have more than one error that needs attention. Those errors will be listed under each tax.

Potential banner messages include the following:

  1. Set up your tax account
  2. You have [#] tax accounts that need to be set up
  3. Set up your tax account to avoid fees
  4. You have [#] tax accounts that need to be set up to avoid fees
  5. In 7 days you’ll start incurring fines
  6. Your missing info is incurring fines
  7. In 7 days your payroll will be blocked
  8. Your Payroll is paused
Missing Tax ID

When a Tax ID is missing, an alert will appear underneath the tax account in the Tax Set Up section within Payroll Settings as well as on the Payroll Tab. This is a courtesy alert to remind you to complete your tax setup before a late fee is issued after 60 days. The alert will display for 97 days, and if the tax IDs are not updated by then, you will need to reach out to Payroll Support before processing your payroll.

Required tax accounts

You will need to register and add any new state tax accounts to BambooHR when hiring an employee working in a state your company currently doesn't operate in. This is common for those hiring remote workers.

A failure to add new state tax accounts that apply to your employees could result in not being able to run payroll.

A banner for a required tax will display on the Payroll tab. Click Set Up Now to add the new tax account. These tax accounts will also be flagged within the Tax Set Up table in Settings > Payroll > Taxes.

A modal will display, and upon selecting the effective date, the State and Tax Type fields will pre-populate. Be sure to choose an effective date that aligns with the quarter of the employee's first pay date.

Taxes BambooHR Payroll does not support

While our tax engine supports over 7,400 jurisdictions, there are a few we cannot support. Please work with your accounting team to ensure these taxes are paid. The table below lists the unsupported tax types.

StateTax TypeTax Type DescriptionNotes
Arkansas Arkansas Texarkana Resident Withholding Exemption

Paid by employee

You can exempt Arkansas State Withholding for Texarkana residents in employee settings (employee profile Pay Info tab Taxes) if you receive Form AR4EC(TX) from the employee; however, BambooHR does not provide annual filing services for Texarkana. You are responsible for the annual filing.

HawaiiHI SDI EEHawaii State Disability TaxPaid by employee
New JerseyNJ-Jersey City-ERNew Jersey - Jersey City Payroll TaxPaid by employer
New JerseyNJ-NewarkNew Jersey Newark (City, Employer Expense TaxPaid by employer
New Mexico New Mexico Workers Compensation (Fee)Paid by employer/employee
NevadaNV-MBTNevada-Modified Business (General Business)Paid by employer
New YorkNY-ECETNew York Employer Compensation ExpensePaid by employer
OhioJEDDOhio Joint Economic Development District [District/Zone]Ohio has 1,200+ local taxes. We do not support any JEDD.
Oregon Seattle Payroll Expense 
VermontVT-ER Health CareVermont - Employer Health InsurancePaid by employer
Any State Workers CompensationException: WA-LI (see below)

We do withhold New York State Disability Insurance and New York Family Leave Insurance taxes. However, we do not remit those taxes to the state agency. BambooHR Payroll will withhold those taxes from the applicable employees, but that amount will not be collected as part of your Cash Requirement to allow you to remit the payments independently.

Do you need to set up workers' compensation?

Workers' Compensation for those operating in the state of Washington will be managed in the Company Tax section of Payroll Settings. Click here for further instructions. All other states that include Workers' Compensation will be managed in the Workers Compensation section of Payroll Settings.

How do I deduct the workers compensation tax for my employees in New Mexico within Payroll? 

BambooHR does not support the New Mexico Workers' Compensation tax. This is a fee for the state to administer workers' compensation, not an actual coverage policy, which your company is responsible paying for quarterly. If your company chooses to have your employee's pay for this, you can set up a deduction in BambooHR during payroll.

  1. Navigate to Settings > Benefits > Plans.
  2. Click + Create New Plan and choose the Other option.
  3. Name the plan: NM Workers Comp Assess Fee and choose "Other Post-Tax Deduction" as the Plan Type.
    • If you use Benefits Administration, you will need to set up a new carrier on the Carriers tab. Use the following information to complete the Carrier setup:
      • Carrier EIN: 123456789
      • Name: None
      • Group Number: 0000
  4. Enroll NM employees on their Benefits tab within their profile using $0 for Employee Pays and $0 for Company Pays.
  5. On the final payroll of the quarter, you must manually adjust the "Employee Pays" and "Company Pays" amounts during payroll processing:
    1. $2.00 Employee Pays
    2. $2.30 Company Pays
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