Corporate Tax in Fairfield, Alabama
In Fairfield, Alabama, a "corporation" is specified 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 most of the same rights, privileges, and commitments as living, breathing human beings.
One of these commitments is the duty to pay income tax in much the same way as an individual person.
Corporate Tax Rate in Fairfield, Alabama
Basically every for-profit corporation in the U.S. is required to pay taxes on its income each year. Most states also have their own corporate income tax. All corporations in Fairfield, Alabama are required to pay it.
In most states, and at the federal level, corporations are taxed at a different rate than individuals. At the federal level, the corporate income tax maxes out at 35% for corporations that earn more than $18.3 million per year. Corporations that earn less than $50,000 per year are taxed at 15%. There are many tax brackets in between. Nonetheless, the individual federal income tax rate tops 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 determined 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 Fairfield, Alabama are obligated to comply with state and federal income tax laws. Failure to pay income tax can be punished by massive fines, which can occasionally prove financially ruinous.
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How Can a Fairfield, Alabama Corporate Tax Lawyer Help?
Many bigger companies have corporate attorneys and accountants on staff who help them adhere with federal and state tax laws.
As most business owners know, however, the majority of small Fairfield corporations can't afford to have attorneys on staff full time. Therefore, 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 Fairfield, Alabama tax attorney immediately.