Discussion:Franchise Tax
From TaxAlmanac, A Free Online Resource
Note: You are using this website at your own risk, subject to our Disclaimer and Website Use and Contribution Terms.
From TaxAlmanac
Discussion Forum Index --> Basic Tax Questions --> Franchise Tax
Discussion Forum Index --> Tax Questions --> Franchise Tax
| 2 December 2007 | |
| When calculating the state tax deduction do I have to take in consideration the franchise tax? | |
| 2 December 2007 | |
| Depends; In New Mexico, a Franchise tax is levied for C and S-Corps every two years and is paid along with the filing of the biennial Corporate Report. Hope that helps.. | |
| December 3, 2007 | |
| Business franchise tax should be paid by the company and deducted on the company books. If you are in a state in which franchise tax relates to a schedule C business, it should be deducted on C. | |
| 3 December 2007 | |
| A franchise tax is a tax imposed for the privilege of doing business in a state, usually in corporate or limited liability form. It can be measured by anything -- capital stock, net worth, gross receipts (the new Ohio Commercial Activity Tax is a form of franchise tax), gross margin (the measure of the Texas franchise tax beginning with the 2008 privilege year), or net income (e.g., California, Wisconsin, New York).
A franchise tax is a business tax and is deductible by the business, rather than as an individual itemized deduction. If the business is a Schedule C (e.g., a single-member LLC, which is subject to franchise tax in a few states, e.g., Tennessee), the franchise tax is deductible on Schedule C, an "above the line" deduction, rather than on Schedule A. State taxes on or measured by income (including franchise taxes measured by income) are often required to be added back for state income tax purposes. | |
| 3 December 2007 | |
| In CA, you cannot deduct the franchise tax at the state level. However, you may deduct the LLC fee. | |
To join in on this discussion, you must first
log in.
