What tax codes would you choose for starting business that is trying to get off the...

Question

Question

What tax codes would you choose for starting business that is trying to get off the ground and and why?

Answer 1

Answer #1

Businesses are responsible for complying with state and local tax obligations. There are three main models for state small business tax rates:

Corporate Income Tax: In most states, C-corporations must pay a corporate tax rate of 4% to 9% on net business income.
Gross Receipts Tax: A few states, including Texas and Washington, charge a gross receipts tax instead of a corporate income tax. Gross receipts tax is levied on a business’s gross sales, instead of net income. A business usually can’t take deductions before this tax is calculated.
Franchise Tax: Some states charge a franchise tax in addition to or instead of a gross receipts tax or income tax. A franchise tax is calculated on the value of a business’s stock or assets, and usually ranges from 0.1% to 0.9%.

Answer 2

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