Workers’ Compensation
Workers’ Compensation requirements vary by state, but most businesses with employees are required to carry coverage.
This may include:
- Sole proprietors with employees
- LLCs with employees
- Corporations, with or without employees
Workers’ Compensation helps protect employees financially if they are injured or become ill due to their job.
Corporations: State Law determines if owners can opt out of coverage. Must provide coverage for employees.
PA: Corporate officers can choose to exclude themselves from coverage. Important: An Application For Exemption Form must be filed if an officer would like to opt out of coverage (or opt out for the company if they are the only employee)
NJ: Corporate officers cannot opt out of coverage and must be included.
NY: Corporate officers with a significant ownership stake (typically more than 1%) may choose to exclude themselves from coverage.
CA: Corporate officers with a significant ownership stake (typically more than 10%) may choose to exclude themselves from coverage.
DE: Corporate officers are covered, unless they choose to be excluded from coverage.
MD: Corporate officers can elect to exclude themselves from coverage if they own at least 20% of the corporation’s stock.
DC: Corporate officers can choose to be included or excluded from coverage.
VA: Required to have Workers’ Compensation if the corporation has 3 or more employees, including corporate officers. Corporate officers may elect to exclude themselves from coverage.
All businesses must ensure compliance to avoid legal and financial penalties.
