Corporate Tax in Brewton, Alabama
In Brewton, Alabama, a "corporation" is defined as a legal entity that's separate from its owners. So, from a legal standpoint, the owner of a corporation and the corporation itself are not the same "person."
This doctrine is known as "corporate personhood." While the concept is somewhat abstract, the law of Alabama treats corporations as individual persons, for most purposes. This means that, legally, corporations have many of the same rights, privileges, and obligations as living, breathing human beings.
One of these obligations is the duty to pay income tax in much the same way as an individual person.
Corporate Tax Rate in Brewton, Alabama
Every corporation in the U.S. which has taxable income must pay its share of the federal corporate income tax. The majority of states also have a corporate income tax, which Brewton, Alabama corporations are required to pay.
At the federal level, and in some states, corporations are taxed at different rates from individuals. Federally, the top corporate tax rate is 35% - a rate applying to corporations earning more than $18.3 million per year. Corporations earning less than $50,000 a year pay a 15% corporate tax rate, and there are a few tax brackets in between. For comparison, the federal income tax for individuals maxes out at 33%.
The corporate tax rate in Alabama may also differ from the individual tax rate. However, in many states, the corporate tax rate is lower than the individual income tax rate. This is because many states believe that the best way to attract business (and therefore improve their economies) is to have a low corporate tax rate.
In any case, Brewton, Alabama corporations have to pay both the state and federal income tax. If they fail to do so, they can be subject to severe penalties, such as very large fines. These fines can be big enough to put some smaller companies out of business. Suffice to say, it's usually cheaper for corporations to pay their taxes than to not.
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How Can a Brewton, Alabama Corporate Tax Lawyer Help?
Most larger corporations have lawyers and accountants who ensure that they are in full compliance with both state and federal tax law.
As most business owners know, however, the majority of small Brewton corporations can't afford to have attorneys on staff full time. So, if you run a small corporation, and are confused about the corporate tax issues that may affect you, it's a very good idea to retain the services of a Brewton, Alabama tax attorney immediately.