Employee Leasing Company (LLC) - $50,000 Bond - Statewide in Rhode Island

Brief Summary

Rhode Island asks for this $50,000 bond only while an employee leasing company is building a track record with the Division of Taxation. Post it, keep your withholding current, and once you have been certified for two years the requirement falls away.

Employee leasing and temporary help service companies must be certified by the Rhode Island Division of Taxation every year under RIGL 44-30-71.4. A company that has not been certified for at least two years must also post a $50,000 surety bond each year, payable to the Tax Administrator, guaranteeing that withholding and other taxes due to the state are paid.

We can help with all Rhode Island bonds!

How to Apply for a Employee Leasing Company (LLC) - $50,000 Bond:

• Confirm whether the company has been certified by the Division of Taxation for at least two years. If not, the $50,000 bond is required.
• Have the company's legal name, federal ID number and business address exactly as they will appear on Form EMP-APP.
• Gather officer, partner or principal names, addresses and Social Security numbers, plus any prior association with other employee leasing firms in the past six years.
• Obtain the $50,000 bond on Division of Taxation Form EMP-B, naming the Tax Administrator of the State of Rhode Island.
• File Form EMP-APP with the bond and the $500 new application fee. Renewals cost $250 and are filed during July each year.
• Pay any outstanding withholding taxes by certified check or money order before the certificate is issued.

Detailed Information About the Rhode Island Employee Leasing Company (LLC) - $50,000 Bond:

The bond is for newer companies

The $50,000 bond is not permanent. The Division of Taxation's application, Form EMP-APP, says employee leasing and temporary help service companies that have not been certified by the Division for at least two years must post a bond of $50,000 each year with surety. The Division's employee leasing page puts it more simply: the $50,000 surety bond is required for the first two years. The amount is the same whether the company is an LLC, a corporation or another type of business.

Annual certification

RIGL 44-30-71.4 makes certification a condition of doing business in Rhode Island. Every employee leasing company, defined as any individual, firm, partnership or corporation engaged in providing workers to employers or firms under a contract or leasing arrangement, must apply to the Division of Taxation during July of each year. The certificate confirms that all withheld income taxes have been remitted to the Division and that employment security and temporary disability insurance contributions have been remitted to the Department of Labor and Training. No certificate is issued if those amounts are unpaid, and the Division states a company must be compliant with all Rhode Island tax obligations to be licensed.

The application fee is $500 for a new company and $250 for a renewal. The license year begins August 1, and the Division mails renewal applications each year.

Why clients care

An employer that uses an uncertified leasing company becomes jointly and severally liable for the taxes that should have been withheld and remitted. Certification protects your clients as well as your company.

The bond form

The Division's bond form, EMP-B, sets a penal sum of $50,000 with the Tax Administrator of the State of Rhode Island as obligee. It guarantees payment of all taxes, interest and penalties under Chapter 30 of Title 44. The surety may cancel on 30 days written notice by registered mail, and the bond stays liable for one year and a day after expiration for violations that occurred before cancellation, unless the Tax Administrator certifies that all taxes have been paid.

Eligibility and Requirements for a Rhode Island Employee Leasing Company (LLC) - $50,000 Bond:

• Bond amount of $50,000 each year until the company has been certified for at least two years.
• Tax Administrator of the State of Rhode Island as obligee.
• Compliance with all Rhode Island tax obligations, including withholding remitted to the Division of Taxation.
• Employment security and temporary disability insurance contributions remitted to the Department of Labor and Training.
• A current list of client firms, which the Division may require with the application.

Rhode Island Employee Leasing Company (LLC) - $50,000 Bond FAQs:

Official and Additional Resources for the Rhode Island Employee Leasing Company (LLC) - $50,000 Bond: