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franchise tax

A franchise tax is a state tax on businesses and other entities (corporations, limited liability companies, trusts, etc.) that are formed in or doing business in a state.

A franchise tax is said to be a tax on the privilege of doing business in a state and is sometimes referred to as a privilege tax. The amount of tax due is often calculated as a percentage of a business’s income, for example.

In New York, the franchise tax, also known as a business corporation tax, applies to corporations conducting business, employing capital, owning or leasing property, or maintaining an office in the state. This tax is essentially a fee for the privilege of doing business in New York. The tax is calculated in several ways, including a fixed dollar minimum (FDM) based on New York State receipts, a tax on business and investment capital, a tax on minimum taxable income, or a tax on entire net income (ENI). The specific method used depends on the corporation's business activity and the amount of its receipts. Limited liability companies (LLCs), limited partnerships (LPs), and S corporations are subject to different tax structures, such as the New York State pass-through entity tax. The franchise tax requirements and rates can vary, so it's important for businesses to consult with an attorney or a tax professional to understand their specific obligations under New York law.

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Taxes

franchise tax

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Taxes

franchise tax

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