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CITIES WITH CORPORATE TAX RATES

 

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City Taxes

Learn what your tax obligations are if you have businesses in these cities.  Most of these cities not only require you to pay the corporate tax but also to withhold tax for those individuals working for your company.  See a list by city below.

Chicago, IL

The City Council today voted to eliminate the much-maligned "tax on jobs" by mid-2014, in keeping with a campaign promise by Mayor Rahm Emanuel. The so-called head tax, paid by the city's larger companies, will be cut in half to $2-per-employee each month on July 1. It will be wiped out two years later. "I want to applaud the mayor and my colleagues for this," said Ald. Thomas Tunney, 44th, a restaurant owner who has campaign for the tax's repeal since 1995, before he was elected to the City Council.

Los Angeles, CA

Tax Rate:
Corporations:

The rate is $1.05-$5.38 for every $1,000 of gross receipts depending on which "Tax Rate" you business fall under (A-F).  See Section 21.41.

The minimum tax under Section 21.188 is $153.00 per year or any portion of the year. There are numerous other categories. Please go to the New Business Tax Rates page for more information.

Exemptions:
Yes. Starting on January 1, 2007, a small business with $100,000 or less of taxable and nontaxable gross receipts within and without the City, may qualify for a Small Business Exemption (LAMC Section 21.29).  To obtain the exemption, the Office of Finance must receive a renewal form in a timely manner. For further information on the exemptions and requirements to qualify, please refer to our exemption page.

Who Must Pay:
This section requires that every person engaged in any trade, calling, occupation, vocation, profession or other means of livelihood in the City of Los Angeles, must obtain a Tax Registration Certificate (TRC) and pay the required business tax due, specified in Sections 21.41 to 21.199 of the Business Tax Ordinance.

You are considered to be engaged in business in the City of Los Angeles when you physically perform work within the City of Los Angeles for seven (7) or more days per year.

 
San Francisco, CA
Tax Rate:

Payroll Expense Tax: 1.5%

Gross Receipt Tax: $0.75 per $1,000 to $5.60 per $1,000.  This tax is applied based on the industry your business is in and the amount of gorss receipts.  For example:

- Retail, Wholesale & certain Services (NAICS Codes 42, 44, 45, 811, 812 & 813:
    - 0.075% ($0.75 per $1,000) for gross receipts between $0-$1,000,000
    - 0.100% (e.g. $1 per $1,000) for gross receipts between $1,000,000-$2,500,000
    - 0.135% (e.g. $1.35 per $1,000) for gross receipts between $2,500,001 and $25,000,000
    - 0.160% (e.g. $1.60 per $1,000) for gross receipts over $25,000,000

- Manufacturing, Transportation & Warehousing, Information, Biotechnology, Clean Technology & Food Services NAICS Codes 31, 32, 33, 48, 49, 51 & 722:
    - 0.125% ($1.25 per $1,000) for gross receipts between $0-$1,000,000
    - 0.205% (e.g. $2.05 per $1,000) for gross receipts between $1,000,000-$2,500,000
    - 0.370% (e.g. $3.70 per $1,000) for gross receipts between $2,500,001 and $25,000,000
    - 0.475% (e.g. $4.75 per $1,000) for gross receipts over $25,000,000

Visit the Gross Receipt Law to find your specific industry and learn what your tax rate will be.  Learn more from the San Francisco Payroll Expense Tax Ordinance.


All businesses with a taxable San Francisco payroll expense greater than $150,000 must pay the 1.5% Payroll Expense Tax by the last day of February for the prior calendar year (1 Jan - 31 Dec).  This tax is being phased between 2014-2018 and is being replaced by the Gross Receipt Tax which goes into effect January 2014.

The Gross Receipt Tax will affect businesses with over $1,000,000 in revenues.  You are required to pay both taxes until the Payroll Expense Tax is phased out.

The Gross Receipt Tax will not affect certain businesses as follows:

1. Contracting with, acting through, or otherwise using the services of, any investment advisor or affiliate thereof which is not related entity.

2. Maintaining documents of formation, incorporation, or registration within the city.

3. Being an owner, member, or other participant in an entity engaging in business within the city chich is a pass-through entity for federal cincome tax pruposes.

4. Having trustees or directors who meet or reside within the city.

San Jose, CA
San Jose tax
http://www.sanjoseca.gov/index.aspx?NID=1155
 

Grand Rapids, MI

Tax Rate:
Resident tax rate:  1.3% - 1.5%
Nonresident tax rate:  0.75% - 0.65%
Corporation tax rate:  1.3% - 1.5%
 
Payment requirement:
You must make estimated income tax payments throughout the year if you expect to owe more than $100 for individuals and partnerships or $250 for corporations. Quarterly payments are due on or before April 30, June 30, September 30, and January 31.
 
Individuals are required to file as well:
- Every resident or part year resident of Grand Rapids who has taxable income in a tax year must file a return.
 
- Every nonresident who has taxable income derived from working or from sources inside the city limits must file a return.

Filing:
Every corporation doing business in the city, whether or not it has an office or place of business in the city and whether or not it has net profits, is required to file a return. Corporations cannot choose to file and be taxed as partnerships. However, nonprofit corporations who have applied for and received approval for exemptions from federal income tax, state and national banks, trust companies, insurance companies, building and loan institutions, savings and loan associations and credit unions are exempt from the city income tax.
Subchapter "S" corporations doing business in the City of Grand Rapids must file as a "C" corporation for city income tax purposes.

Every partnership that conducted business in the City of Grand Rapids, whether or not an office or place of business was maintained in the city is required to file an annual return. Syndicates, joint ventures, pools and like organizations must also file an annual return.

If a partnership chooses to pay the taxes for the partners, the partners are not required to file a return as long as they have no other income subject to tax. The partners must file an individual return if they have taxable income other than the distributive share of net profits from the partnership.

Withholding:
Every employer who does business in the City of Grand Rapids is required to withhold Grand Rapids income tax. This applies even if you do not maintain a location in Grand Rapids.

All withholding tax payments are due on the last day of the month after the reporting period. All Grand Rapids income tax withholding payments should be sent to the above address.

Muskogen, MI

Taxe Rate:
Corporation: 2% - 2.3%

Filing:
All corporations doing business or located in the City of Muskegon including sub-chapter S corporations must file a corporate return.  Businesses must withhold taxes for employees.

For partnerships doing business or located in the City of Muskegon, each partner in a partnership is required to file an individual return unless the tax is paid by the partnership. The partnership must file a partnership return.

Withholding:
Every employer is required to withhold who:
a.) has a location in the city, or
b.) who is doing business in the city even though it has no location in the city

Corporate Instructions and Forms

Pontiac, MI

Tax Rate:
Residents:
1% (.01)
Nonresidents:
½% (.005)
Corporation tax rate:  1% (.01).

Filing:

City of Pontiac Income tax returns are due on or before April 30, or within 4 months after the end of your fiscal year.

The estimated tax for the current year may be paid in full with the first payment or in four (4) equal installments on or before April 30, June30, September 30, and January 31 of the following year.

For corporations on a fiscal year the payments are due on before the 4th 6th, 9th and 13th month after the beginning of taxable fiscal year.

Every corporation doing business in the City of Pontiac , whether or not it has an office or place of business in the city or net profit, is required to file a City of Pontiac Income Tax Corporation Return , Form P-1120. Sub Chapter S corporations are treated as C corporations an must file an P-1120. Non–profit corporations, which have applied for and received approval for exemptions from Federal income tax, shall not be required to file a return.

Every partnership that conducted business in the City of Pontiac , whether or not an office or place of business was maintained in the city is required to file a Partnership Income Tax Return (P-1065).

Saginaw, MI

Tax Rate:
Corporate
- 1.50%
Individual Resident - 1.50%
Individual Non-Resident - .75%

Filing:
City of Saginaw Income Tax returns are due on or before April 30, or within four months after the end of your fiscal year.

The estimated tax for the current year may be paid in full with the first payment or in four (4) equal installments on or before April 30, June 30, September 30, and January 31 of the following year.

For corporations on a fiscal year the payments are due on or before the 4th, 6th, 9th and 13th month after the beginning of taxable fiscal year.

Every corporation doing business in the City, whether or not it has an office or place of business in the city or a net profit, is required to file a City of Saginaw Income Tax Corporation Return, Form S-1120.

Corporations cannot elect to file and be taxed as partnerships and visa versa. Sub-Chapter S corporations are treated as C corporations and must file a S-1120.

Non-profit corporations, which have applied for and received approval for exemption from the Federal income tax, shall not be required to file a Saginaw return provided they submit, to the Administrator, a copy of their exemption approval from the Internal Revenue Service. Such exemption from the City's filing requirement will continue in effect as long as their Federal exemption is in effect.

The ordinance also specifically exempts state and national banks, trust companies, insurance companies, building and loan and saving and loan associations, and credit unions (either state chartered or federal chartered).

New York City, NY

Tax Rate: (See more at):
General Corporation Tax is computed by four different methods and is imposed at whichever method produces the largest amount of tax.
  1. Entire net income base = 8.85% of "net income allocated to New York City"; OR
  2. Total Capital base = .15% of business and investment capital allocated to New York City (for cooperative housing corporations that rate is .04%), not to exceed $350,000 for tax years in or before 2008, or, $1,000,000 for tax years beginning in or after 2009; OR
  3. Alternative tax base (as of January 1, 2010) = 8.85% of 15% of net income plus the amount of salaries or other compensation paid to any person, including an officer, who at any time during the taxable year owned more than five percent of the taxpayer’s issued capital stock. OR
  4. For tax years beginning in or before 2008 a minimum tax of $300. If a return is filed for a period of less than one year, the tax is still $300. It cannot be prorated. For tax years beginning in or after 2009, the minimum tax is based on a corporation’s New York City receipts computed as follows:

Who is Subject to This Tax?
Except for certain exemptions, the General Corporation Tax is imposed on all domestic and foreign corporations that are engaged in any of the following four activities in New York City during their calendar or fiscal year:

  • Doing business;
  • Employing capital;
  • Owning or leasing property, in a corporate or organized capacity; or
  • Maintaining an office.
New York City does not recognize federal or New York State "S Corporation" elections. S Corporations are subject to this tax. Furthermore, beginning in 1996, an association or publicly traded partnership that is taxable as a corporation for federal income tax purposes is treated as a corporation for the purpose of this tax.
 
If a corporation is not subject to the tax, but it has an officer, employee, agent, or other representative within the five boroughs, it must nevertheless file Form NYC-245, the Activities Report for Corporations.

Who is Exempt from the Tax?
The instructions to Forms NYC-3L and 4S explain in detail what types of corporations are exempt from the General Corporation Tax:

- Dormant corporations, which at no time during the taxable year engaged in any activity or held title to real property located in New York City;

- Corporations subject to the New York City Banking Corporation Tax or Utility Tax, except vendors of utility services which are subject to the General Corporation Tax;

- Corporations organized exclusively for the purpose of holding title to property as described in Sections 501(c)(2) or (25) of the Internal Revenue Code;

- Insurance Corporations;

- Nonstock not-for-profit companies that have been granted an exemption by the New York City Department of Finance; and

- Limited profit housing and housing development fund companies organized and operating under articles 2 and 11, respectively, of the Private Housing Finance Law.

Estimated Tax:
If the corporation can reasonably expect its tax to exceed $1,000 for the taxable year, it must file Form NYC-400 (Declaration of Estimated Tax) and pay the estimated tax. Estimated tax can also be paid in installments. A payment of 25 percent of the tax liability for the preceding year is required as the first installment of estimated tax for the current year.
Properly estimated tax must be either 1) not less than 90 percent of the tax that is finally determined, or 2) not less than the tax for the preceding taxable year.

Bowling Green, OH

Tax Rate:
The City of Bowling Green has a flat rate tax of 2.00%. Prior to 1/1/2011, the rate was 1.92%

Filing:
The Bowling Green tax forms (Form R, Declaration of Estimated Income Tax) should be used by individuals, partnerships, corporations and any other entity having income taxable to this municipality. Receipt of forms indicates an obligation to which you must respond.

Unless the tax was withheld by a Bowling Green employer:
  1. Residents must file on all taxable income, wherever earned.
  2. Part-year residents must file on all taxable income earned during the period of their Bowling Green residency and should pro-rate income, expenses and credits accordingly.
  3. Nonresidents must file on all taxable Bowling Green income.
For all calendar year filers, returns are due April 15. (For 2011 returns, the due date is April 17, 2012 due to a Federal holiday) If the return is made for a fiscal year or any period of less than a year, the return shall be filed within three and one half (3 1/2) months from the end of each fiscal year or other period.

Columbus, OH

Tax Rate:  The Columbus Division of Income Tax collects and administers the income tax for:

Columbus:  (2.5%)
Brice:  (2%)
Canal Winchester:  (2%)
Groveport:  (2%)
Harrisburg:  (1%)
Marble Cliff:  (2%)
Obetz:  (2%)

You will normally have to remit two types of city taxes: the net profits tax and (if you have employees) the employee withholding tax.

Filing:
The first is the tax due on profits of your business, whether your business is a sole proprietorship, corporation or partnership. Incidentally, all the cities whose taxes are administered by Columbus tax the net profits earned within each city by S-corporations at the corporate level. As such, the individual shareholders of S-corps are not taxed. Columbus and Harrisburg require partnerships and the limited liability companies (LLC's) to file and remit at the business level on behalf of all partners. All businesses, with the exception of sole proprietorships, file their city taxes using Form BR-25. Additional information on the net profits tax for businesses other than sole proprietorships is available in the instructions for the BR-25.

Sole proprietorships file by reporting their Federal Schedule C income on the proprietor's individual city return (Form IR-22 or, if reporting tax to more than two cities, Form IR-25). Additional information is available in the instructions for the IR-22 or IR-25. Click on Tax Forms to view and download the IR-22, IR-25 or the BR-25 and the instructions to each. You will need Adobe Acrobat to view the download. If you don't have Adobe Acrobat, you can download it free at http://www.adobe.com.

To remit the second type of tax, the tax withheld from your employees' wages, you will need to establish a withholding account with us. You do this by filing a Form IT-47, which is a simple questionnaire. Employers are liable for all city withholding taxes that should have been withheld from their employee's wages EVEN if those taxes were not, in fact, withheld. Because of this obligation, you'll want to make sure you set-up your employer withholding account as soon as you hire employees. You can call (614) 645-7370 to request to have a copy of the IT-47 mailed to you or click on Tax Forms to view and download Form IT-47.

Philadelphia, PA

Rates in effect from 1 Jan - 30 June 2012:
Residents:  3.9280% (.03928)
Non-Residents:  3.4985% (.034985)
Corporations:  1
.415 mills on gross receipts and 6.45% on taxable net income

On May 1, 2012, the BPT will be renamed the Business Income and Receipts Tax. Beginning in 2014, businesses will be able to take an exclusion of $50,000 that will increase over the following years to $100,000 in 2016.

Filing:

Every individual, partnership, association and corporation engaged in a business,
profession or other activity for profit within the City of Philadelphia must file a
Business Privilege Tax Return, whether or not they earned a profit during the
preceding year.

Rental activities are usually considered to be business activities.  Every estate or trust, (whether the fiduciary is an individual or a corporation) must file a Business Privilege Tax Return if the estate or trust is engaged in any business or activity for profit within the City of Philadelphia.

 
The Business Privilege Tax is based on both gross receipts and net income. Both parts must be filed.
 
Returns for this tax are due by April 15.
 
If you maintain a Business Privilege License but do not actively engage in business, you must file the Business Privilege Tax return and indicate that no business occurred. If you do not file a return, you will receive a non-filer notice and court costs could be imposed.

Find more information at: http://www.phila.gov/revenue/bpt.html

 

Below is a rollup of cities with corporate tax requirment

 

City

State

Rate

Chicago

IL Repealed

Los Angeles

CA $1.05-$5.38 per every $1,000

Grand Rapids

MI 1.3%-1.5%

Muskogen

MI 2%-2.3%

Pontiac

MI 1%

Saginaw

MI 1.5%

New York City

NY 8.5%

Bowling Green

OH 2%

Columbus

OH 2.5%

Brice

OH 2%

Canal Winchester

OH 2%

Groveport 

OH 2%

Harrisburg

OH 1%

Marble Cliff

OH 2%

Obetz

OH 2%

Philadelphia

PA 1.415 mills on gross receipts and 6.45% on taxable net income
San Francisco CA $0.75 per $1,000 to $5.60 per $1,000

 

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