Corporate Tax in Prescott Valley, Arizona
In Prescott Valley, Arizona, 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 Arizona 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.
An noticeable example of this concept is a corporation's obligation to pay income taxes similar to how an actual person would.
Corporate Tax Rate in Prescott Valley, Arizona
Every corporation in the U.S. which has taxable income must pay its share of the federal corporate income tax. The majority of states further have a corporate income tax, which Prescott Valley, Arizona corporations are required to pay.
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. However, the individual federal income tax rate tops at 33%.
The tax rate in Arizona 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 Prescott Valley, Arizona 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 Prescott Valley, Arizona 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 Prescott Valley 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 Prescott Valley, Arizona tax attorney immediately.