Corporate Tax in Montevallo, Alabama
In Montevallo, Alabama, a "corporation" is defined as a legal entity that's separate from its owners. Therefore, from a legal standpoint, the owner of a corporation and the corporation itself are not the same "person."
This doctrine is recognized 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.
As a prime example, corporations have to pay income taxes, just as a person would.
Corporate Tax Rate in Montevallo, Alabama
Every corporation in the United States is required to pay federal income tax. Most states also have a corporate income tax, which corporations doing business in Montevallo, Alabama 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 tax rate in Alabama for corporations probably also differs from the taxes that individuals must pay. In some states, the government has decided that their interests would be best served by making corporate taxes as low as possible. So in many states, the tax rate for corporations is much lower than the one paid by individuals, unlike the federal corporate tax.
Whatever their legal tax rate, all corporations in Montevallo, Alabama are required to comply with state and federal income tax laws. Failure to pay income tax can be punished by massive fines, which can sometimes prove financially ruinous.
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How Can a Montevallo, Alabama Corporate Tax Lawyer Help?
Many major corporations employ tax lawyers full time, to ensure that they are in compliance with tax laws, and find legal means to reduce their tax liability.
But if you are the owner of a small corporation in Montevallo, chances are you don't have a full-service legal department on your payroll. Therefore, if you need help with your corporate taxes, it's crucial that you speak with a lawyer in Montevallo, Alabama who practices tax law.