The Tax Cuts and Jobs Act (TCJA) has brought on major tax law change that impacts small businesses. The TCJA enhanced some tax breaks, repealed others and modified several deductions that are likely to affect a majority of business owners. Here’s one change.
Corporate tax rate
Corporate tax is now a flat 21% rate, changed from a multi-bracket structure with a 35% top rate.
Many U.S. corporations elect to use a fiscal year end and not a calendar year end for federal income tax reporting purposes. Due to a provision in the Tax Cuts and Jobs Act (TCJA), a corporation with a fiscal year that includes Jan. 1, 2018 will pay federal income tax using a blended tax rate and not the flat 21 percent tax rate under the TCJA that would generally apply to taxable years beginning after Dec. 31, 2017.
If you have any questions, visit with one of our Tax experts.
Published: 9-13-18
