When You Want More
All states have taxes and fees. We are always fascinated at where people can live and operate their businesses to avoid as much tax as possible LEGALLY. If you’ll look at the various state links below, you’ll find the personal income tax rates, corporate income tax rates, corporate franchise tax rates, forms to file, sales tax, deductions, exemptions, and all the state agency details that govern these taxes.
State Corporate Income Tax Guide And State Personal Income Tax Guide
The thing about taxes and fees are that some states are what we might call “fee” states. For instance, Texas charges $300 to form an LLC, and regular items that are free in most states have fees associated with them in Texas. BUT Texas has no personal income tax and no tax at the company level for the first 1 million dollars of revenue. So you could have a great mid-sized business in Texas and pull in 990,000 dollars a year and not pay any tax at all. Texas has sales tax, however, so it can be advantageous to also form other companies (for the purpose of purchasing assets) in other states that don’t have sales tax, such as buying that Ferrari you always wanted in a Montana LLC and thus not paying sales tax for the car.
Other states are what we might call “taxing” states. Oregon, for example, has no sales tax, but they have one of the highest income taxes in America. Then there are states, such as New Jersey, that are both fee states and taxing states.
Ultimately, unless you want to go to great lengths to save money, taxing states and fee states usually cost businesses about the same. Our state and local governments need revenue to survive, so if they start losing income in taxes, they will raise fees to make up the difference. Nevertheless, there are definitely states where you will shell out less money to government agencies overall.
We can’t offer you legal or tax advice, but we invite you to explore the table and links below. We have provided the correct form numbers, links to state websites, and information about the corporate tax rates and personal tax rates in each state. Need federal tax information?
| State | Personal Income Tax Rate | Corporate Income Tax Rate | Franchise Tax Rate | Sales Tax Rate | LLC Formation Fee |
|---|---|---|---|---|---|
| Alabama | Up to 5% | 6.5% | N/A | 4% | $100 |
| Alaska | 0% | 9.4% | N/A | 0% | $250 |
| Arizona | Up to 4.5% | 4.9% | N/A | 5.6% | $50 |
| Arkansas | Up to 6.9% | 6.5% | N/A | 6.5% | $50 |
| California | Up to 13.3% | 8.84% | N/A | 7.25% | $70 |
| Colorado | Up to 4.55% | 4.55% | N/A | 2.9% | $50 |
| Connecticut | Up to 6.99% | 7.5% | N/A | 6.35% | $120 |
| Delaware | 0% | 8.7% | N/A | 0% | $90 |
| Florida | 0% | 5.5% | N/A | 6% | $125 |
| Georgia | Up to 5.75% | 5.75% | N/A | 4% | $100 |
| Hawaii | Up to 11% | 4.4% | N/A | 4% | $50 |
| Idaho | Up to 6.5% | 6% | N/A | 6% | $100 |
| Illinois | Up to 4.95% | 9.5% | N/A | 6.25% | $500 |
| Indiana | Up to 3.23% | 5.25% | N/A | 7% | $90 |
| Iowa | Up to 8.53% | 9.8% | N/A | 6% | $50 |
| Kansas | Up to 5.7% | 4% | N/A | 6.5% | $165 |
| Kentucky | Up to 5% | 5% | N/A | 6% | $50 |
| Louisiana | Up to 6% | 8% | N/A | 4.45% | $100 |
| Maine | Up to 7.15% | 8.93% | N/A | 5.5% | $145 |
| Maryland | Up to 5.75% | 8.25% | N/A | 6% | $100 |
| Massachusetts | Up to 5% | 8% | N/A | 6.25% | $500 |
| Michigan | Up to 4.25% | 6.0% | N/A | 6% | $50 |
| Minnesota | Up to 9.85% | 9.8% | N/A | 6.875% | $155 |
| Mississippi | Up to 5% | 5% | N/A | 7% | $50 |
| Missouri | Up to 5.4% | 6.25% | N/A | 4.225% | $50 |
| Montana | Up to 6.9% | 6.75% | N/A | 0% | $70 |
| Nebraska | Up to 6.84% | 5.58% | N/A | 5.5% | $100 |
| Nevada | 0% | 21% | N/A | 6.85% | $425 |
| New Hampshire | 0% | 8.5% (on income) | N/A | 0% | $100 |
| New Jersey | Up to 10.75% | 9% | $500 | 6.625% | $125 |
| New Mexico | Up to 5.9% | 4.8% | N/A | 5.125% | $50 |
| New York | Up to 10.9% | 6.5% | N/A | 4% | $200 |
| North Carolina | Up to 5.25% | 2.5% | N/A | 4.75% | $125 |
| North Dakota | Up to 2.9% | 4.31% | N/A | 5% | $50 |
| Ohio | Up to 3.99% | 8.5% | N/A | 5.75% | $125 |
| Oklahoma | Up to 5% | 6% | N/A | 4.5% | $100 |
| Oregon | Up to 9.9% | 6.6% | N/A | 0% | $100 |
| Pennsylvania | Up to 3.07% | 9.99% | N/A | 6% | $125 |
| Rhode Island | Up to 5.99% | 7% | N/A | 7% | $150 |
| South Carolina | Up to 7% | 5% | N/A | 6% | $110 |
| South Dakota | 0% | 0% | N/A | 4% | $150 |
| Tennessee | 0% | 6.5% | N/A | 7% | $300 |
| Texas | 0% | 0% | $300 | 6.25% | $300 |
| Utah | Up to 4.95% | 4.95% | N/A | 4.7% | $50 |
| Vermont | Up to 8.75% | 8.5% | N/A | 6% | $125 |
| Virginia | Up to 5.75% | 6% | N/A | 5.3% | $100 |
| Washington | 0% | 6.5% | N/A | 6.5% | $180 |
| West Virginia | Up to 6.5% | 6.5% | N/A | 6% | $100 |
| Wisconsin | Up to 7.65% | 7.9% | N/A | 5% | $130 |
| Wyoming | 0% | 0% | N/A | 4% | $100 |
This table provides a comprehensive overview of personal income tax rates, corporate income tax rates, franchise tax rates, sales tax rates, and LLC formation fees for all 50 states in the U.S.