Corporate Tax in Pelham, Alabama
In Pelham, Alabama, a "corporation" is defined as a legal entity that's separate from its owners. Thus, from a legal standpoint, the owner of a corporation and the corporation itself are not the same "person."
This doctrine is identified 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 Pelham, 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 Pelham, Alabama are required to pay.
Under the federal tax system, and the tax laws of some states, corporate income is taxed at a different rate from the income of individuals. For example, the top federal income tax rate for corporations is 35%, compared with 33% for individuals. The highest tax rate applies to corporations making more than $18.3 million per year. The lowest corporate tax rate is 15%, applying to those corporations that make less than $50,000 per year.
There's also a good chance that the tax rate applicable to corporations in Alabama differ from the individual tax rates. Some states feel that the best economic policy is to attract as many businesses as they can. Thus, in some states, the corporate tax rate is lower than the individual tax rate.
Whatever their legal tax rate, all corporations in Pelham, 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 Pelham, 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.
Of course, smaller companies in Pelham can't afford to have full-time legal and accounting departments on their payroll. Accordingly, if your business is organized as a corporation, and has an issue with its taxes, it's imperative that you contact a Pelham, Alabama tax attorney as soon as possible.