Calculate federal corporate tax (21% flat rate) plus state taxes. Includes effective combined rate and full breakdown.
The US federal corporate tax rate is a flat 21%. On $500,000 profit, federal tax is $105,000. With a typical 7% state tax, total is about $140,000 (effective ~28%). States range from 0% (Wyoming, Nevada) to 11.5% (New Jersey). The QBI deduction applies to pass-through entities, not C corps.
| Taxable Income | Federal (21%) | State (7%) | Total Tax | Effective Rate |
|---|---|---|---|---|
| $100,000 | $21,000 | $7,000 | $28,000 | 28.0% |
| $250,000 | $52,500 | $17,500 | $70,000 | 28.0% |
| $500,000 | $105,000 | $35,000 | $140,000 | 28.0% |
| $1,000,000 | $210,000 | $70,000 | $280,000 | 28.0% |
| $5,000,000 | $1,050,000 | $350,000 | $1,400,000 | 28.0% |
Federal rate is flat 21% on all income. State tax is deductible at federal level for some businesses (consult CPA).
| State | Rate | Tax on $500K | Combined w/ Federal |
|---|---|---|---|
| Wyoming / Nevada / SD | 0% | $0 | $105,000 (21%) |
| North Carolina | 2.5% | $12,500 | $117,500 (23.5%) |
| Colorado | 4.0% | $20,000 | $125,000 (25%) |
| New York | 6.5-7.25% | $35,000 | $140,000 (28%) |
| California | 8.84% | $44,200 | $149,200 (29.8%) |
| New Jersey | 9-11.5% | $45,000+ | $150,000+ (30%+) |
Since the Tax Cuts and Jobs Act (TCJA) of 2017, the US federal corporate income tax is a flat 21% on all taxable income — there are no graduated brackets for C corporations. This rate applies to all C corps regardless of size, from a small LLC taxed as a C corp to Fortune 500 companies. State corporate taxes are additional, ranging from 0% to 11.5% depending on the state, with some states using alternative structures like Texas's franchise tax or Ohio's commercial activity tax (CAT).
Pass-through entities (S corps, partnerships, sole proprietors) don't pay corporate tax directly — income passes through to the owner's personal return at rates up to 37%. The QBI (Qualified Business Income) deduction allows eligible pass-through owners to deduct up to 20% of qualified income. Compare with our UAE Corporate Tax Calculator (9%) or UK Corporation Tax Calculator (25%).
Flat 21% federal on all taxable income (no brackets). State taxes add 0-11.5% depending on location. Combined effective rate for most states is 25-30%.
$105,000 (21% × $500,000). With 7% state tax, total is ~$140,000 (28% effective).
Wyoming, Nevada, South Dakota. Texas and Ohio have no traditional corporate income tax but use franchise/CAT taxes instead.
Up to 20% deduction on qualified business income for pass-through entities (S corps, partnerships, sole proprietors). Does not apply to C corporations.
C corps pay 21% corporate tax + shareholders pay tax on dividends (double taxation). S corps pass income to shareholders at personal rates (up to 37%) — no double taxation but potentially higher marginal rates.
C corps: April 15 (6-month extension available). S corps/partnerships: March 15. Estimated quarterly payments: April 15, June 15, September 15, December 15.
The CAMT (15%) applies to corporations with average financial statement income exceeding $1 billion. Most small and mid-sized businesses are not affected.
No brackets for C corps — every dollar of profit is taxed at 21%. This simplifies planning but means no benefit from lower brackets like individual taxpayers get.
Wyoming/Nevada/SD charge 0%, while NJ charges up to 11.5%. Incorporating in a low-tax state saves significantly — but nexus rules mean you may owe tax where you operate, not just where you're incorporated.
S corps avoid double taxation — income passes through to personal returns. But the 37% top individual rate can exceed the 21% corporate rate at higher income levels. Run the numbers with a CPA.
Pass-through owners may deduct up to 20% of qualified business income. This effectively drops the top individual rate on business income from 37% to ~29.6%. Phase-outs apply above $182,100 (single) / $364,200 (joint).
Corporations must pay estimated taxes quarterly (April/June/September/December 15). Underpayment triggers penalties — plan cash flow for quarterly payments.
State income taxes paid are generally deductible on the federal return, reducing the effective combined rate. This makes the actual burden lower than simply adding federal + state rates.