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C-Corporation Filing Questions

Hello,

 

So last year (or 2023) was the first year that my company was in business.  I made no sales during that time (and I reported the operational expenses as losses).  I reviewed what the rules around taxes in the past, and I need to confirm what the tax structure would be for California (in other words, how much would I have been taxed if any for that first year)?  

 

Also moving forward, in terms of expectations around the tax structure (how much would I be expected to be taxed) would be helpful.

 

Thanks

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1 Reply
NateTheGrEAt
Employee Tax Expert

C-Corporation Filing Questions

A C-Corporation in California will pay both Federal and State tax on its net income. 

 

Federal tax on a C-Corp is generally a flat 21% tax rate. (21% of net income after expenses) Publication 542 (01/2024), Corporations | Internal Revenue Service (irs.gov)

 

California State tax on a C-Corp is generally a flat 8.84% tax rate. (8.84% of net income after expenses) C corporations | FTB.ca.gov

 

In addition, there is a minimum franchise tax of $800 per year for any C-Corporation. First year corporations are exempt. This fee is due regardless of whether you have a gain or loss or any revenue at all.  C corporations | FTB.ca.gov

 

I hope this is helpful!

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