For federal purposes, an entity treated as a corporation and organized under the laws of any state is a domestic corporation. Corporate income tax is imposed on all domestic corporations and on foreign corporations having income or activities within the jurisdiction. Certain localities also impose corporate income tax. Ĭorporate income tax as a share of GDP, 1946–2009.Ĭorporate income tax is imposed at the federal level on all entities treated as corporations (see Entity classification below), and by 47 states and the District of Columbia. In 2021 President Biden proposed that Congress raise the corporate rate from 21% to 28%. However, shareholders of S corporations and mutual funds are taxed currently on corporate income, and do not pay tax on dividends. Shareholders of most corporations are not taxed directly on corporate income, but must pay tax on dividends paid by the corporation. Corporations may be subject to foreign income taxes, and may be granted a foreign tax credit for such taxes. Shareholders of a corporation are taxed on dividends distributed by the corporation. These include most formations and some types of mergers, acquisitions, and liquidations. Some corporate transactions are not taxable.
Groups of corporations controlled by the same owners may file a consolidated return. They must make quarterly estimated tax payments. Like individuals, corporations must file tax returns every year.
The corporate Alternative Minimum Tax was also eliminated by the 2017 reform, but some states have alternative taxes. Taxable income may differ from book income both as to timing of income and tax deductions and as to what is taxable. State and local taxes and rules vary by jurisdiction, though many are based on federal concepts and definitions. Since January 1, 2018, the nominal federal corporate tax rate in the United States of America is a flat 21% due to the passage of the Tax Cuts and Jobs Act of 2017. Corporate tax is imposed in the United States at the federal, most state, and some local levels on the income of entities treated for tax purposes as corporations.
0 kommentar(er)
