Franchise Taxes: A Tax for the Privilege of Existing within a State

Virtually every state has some type of franchise tax or fee that is imposed on domestic and/or foreign corporations as part of the cost of doing business in the state. The measure of franchise taxes varies from state to state. While some franchise taxes are measured by nominal or actual value using authorized capital stock or issued capital stock as the tax base, others are measured by earnings, with net income as the tax base. Reference our state survey of franchise tax rates and see how they are determined.  

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