Corporate Tax Rate by State: 2026 Overview Corporate tax rates significantly influence business formation and relocation decisions. Recent trends indicate a continued migration of tech companies from states like California to Texas and other southern states, underscoring the critical impact of corporate tax structures.
For employers and aspiring entrepreneurs seeking detailed insights into corporate tax rates across the United States, we have compiled comprehensive data on corporate tax rates in all 50 states. Here’s what we found:
| State | Corporate Tax Rate | Capital Gains Tax Rate | Property Tax Rate | State-Local Tax Burden |
|---|---|---|---|---|
| Alabama | 6.5% | 5.0% | 0.37% | 9.8% |
| Alaska | 9.4% | 0.0% | 0.98% | 4.6% |
| Arizona | 4.9% | 4.5% | 0.6% | 9.5% |
| Arkansas | 5.3% | 5.5% | 0.61% | 10.2% |
| California | 8.8% | 13.3% | 0.7% | 13.5% |
| Colorado | 4.6% | 4.55% | 0.52 | 9.7% |
| Connecticut | 7.5% | 6.99% | 1.73% | 15.4% |
| Delaware | 8.7% | 6.6% | 0.59% | 12.4% |
| Florida | 5.5% | 0.0% | 0.86% | 9.1% |
| Georgia | 5.8% | 5.75% | 0.87% | 8.9% |
| Hawaii | 6.4% | 7.25% | 0.31% | 14.1% |
| Idaho | 5.8% | 6.93% | 0.65% | 10.7% |
| Illinois | 9.5% | 4.95% | 1.97% | 12.9% |
| Indiana | 4.9% | 3.23% | 0.81% | 9.3% |
| Iowa | 8.4% | 8.53% | 1.43% | 11.2% |
| Kansas | 7.0% | 5.7% | 1.28% | 11.2% |
| Kentucky | 5.0% | 5.0% | 0.78% | 9.6% |
| Louisiana | 7.5% | 4.25% | 0.51% | 9.1% |
| Maine | 8.9% | 7.15% | 1.2% | 12.4% |
| Maryland | 8.3% | 5.75% | 1.01% | 11.3% |
| Massachusetts | 8.0% | 5.0% | 1.08% | 11.5% |
| Michigan | 6.0% | 4.25% | 1.53% | 8.6% |
| Minnesota | 9.8% | 9.85% | 1.05% | 12.1% |
| Mississippi | 5.0% | 5.0% | 0.63% | 9.8% |
| Missouri | 4.0% | 5.4% | 0.96% | 9.3% |
| Montana | 6.8% | 4.9% | 0.74% | 10.5% |
| Nebraska | 7.3% | 6.84% | 1.54% | 11.5% |
| Nevada | 0.0% | 0.0% | 0.56% | 9.6% |
| New Hampshire | 7.5% | 0.0% | 1.89% | 9.6% |
| New Jersey | 11.5% | 10.75% | 2.13% | 13.2% |
| New Mexico | 5.9% | 5.9% | 0.59% | 10.2% |
| New York | 7.3% | 8.82% | 1.3% | 15.9% |
| North Carolina | 2.5% | 4.99% | 0.78% | 9.9% |
| North Dakota | 4.3% | 2.9% | 0.88% | 8.8% |
| Ohio | 0.0% | 4.8% | 1.52% | 10.0% |
| Oklahoma | 4.0% | 4.75% | 0.83% | 9.0% |
| Oregon | 7.6% | 9.9% | 0.91% | 10.8% |
| Pennsylvania | 9.0% | 3.07% | 1.43% | 10.6% |
| Rhode Island | 7.0% | 5.99% | 1.37% | 11.4% |
| South Carolina | 5.0% | 7.0% | 0.53% | 8.9% |
| South Dakota | 0.0% | 0.0% | 1.14% | 8.4% |
| Tennessee | 6.5% | 0.0% | 0.63% | 7.6% |
| Texas | 0.0% | 0.0% | 1.6% | 8.6% |
| Utah | 4.9% | 4.95% | 0.56% | 12.1% |
| Vermont | 8.5% | 8.75% | 1.76% | 13.6% |
| Virginia | 6.0% | 5.75% | 0.84% | 12.5% |
| Washington | 0.0% | 7.0% | 0.84% | 10.7% |
| West Virginia | 6.5% | 6.5% | 0.53% | 9.8% |
| Wisconsin | 7.9% | 7.65% | 1.53% | 10.9% |
| Wyoming | 0.0% | 0.0% | 0.51% | 7.5% |
States with the Highest Corporate Tax Rates
In 2026, five states maintain corporate tax rates of 9% or higher, with twelve states at or above 8%. Below is a list of the top five states with the highest corporate tax rates:
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New Jersey: With a corporate tax rate of 11.5%, New Jersey stands as the only state exceeding 10%. Additionally, it ranks among the top three states for capital gains tax, state-local tax, and property tax.
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Minnesota: Minnesota’s corporate tax rate of 9.8% makes it the second highest in the nation. Its business taxes are generally above average, though not as extreme as New Jersey.
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Illinois: Illinois has a corporate tax rate of 9.5%, coupled with high property and state-local tax rates, though it has a relatively moderate capital gains tax.
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Alaska: Alaska’s corporate tax rate stands at 9.4%, characterized by low property and state-local taxes, as well as a non-existent capital gains tax.
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Pennsylvania: With a corporate tax rate of 9%, Pennsylvania also has moderately high rates across other tax categories.
States with the Lowest Corporate Tax Rates
Currently, six states have a corporate tax rate of 0.0%. While these states may lack corporate taxes, they often compensate with other forms of revenue. Here’s a ranking of these states:
States with No Corporate Tax Rate
| Rank | State | Corporate Tax Rate | Capital Gains Tax Rate | Property Tax Rate | State-Local Tax Burden |
|---|---|---|---|---|---|
| 1 | Wyoming | 0.0% | 0.0% | 0.51% | 7.5% |
| 2 | Nevada | 0.0% | 0.0% | 0.56% | 9.6% |
| 3 | South Dakota | 0.0% | 0.0% | 1.14% | 8.4% |
| 4 | Texas | 0.0% | 0.0% | 1.6% | 8.6% |
| 5 | Ohio | 0.0% | 4.8% | 1.52% | 10.0% |
| 6 | Washington | 0.0% | 7.0% | 0.84% | 10.7% |
These states encourage corporate investment with no corporate taxes, prompting a significant relocation of businesses to states like Nevada and Texas. Other states with low corporate tax rates include:
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North Carolina: North Carolina has the lowest corporate tax rate above 0.0%, at just 2.5%. Its capital gains, property, and state-local taxes are also competitive, making it a popular choice for corporations.
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Oklahoma: Oklahoma’s corporate tax rate is 4%, with all other business taxes below average.
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Missouri: Missouri also maintains a corporate tax rate of 4%, accompanied by slightly higher taxes than Oklahoma.
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North Dakota: North Dakota’s corporate tax rate is 4.3%, paired with a low capital gains tax of 2.9% and generally below-average taxes.
Corporate Tax Rate FAQ
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Is corporate tax different in each state?
Yes, corporate tax rates vary significantly across states, with New Jersey imposing a rate of 11.5%, while Wyoming has no corporate tax. Understanding the differences is crucial for determining where to establish or relocate your business.
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Is corporate tax rate federal or state?
Corporate taxes can be both federal and state. The federal corporate tax rate remains at 21% in 2026, while states like New Jersey have the highest rates at 11.5%. Most states fall within the 4% to 8% range, which adds to the overall tax burden.
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Which US states have no corporate tax?
Six states currently have no corporate tax: These include:
- Wyoming
- Nevada
- South Dakota
- Texas
- Ohio
- Washington
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How do you calculate corporate tax rate?
To calculate corporate tax, multiply taxable income by the applicable tax rate. Here’s how:
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Determine taxable income: $500,000 (revenue) – $200,000 (deductible expenses) = $300,000 (taxable income).
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Identify the applicable corporate tax rate: For example, 20%.
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Multiply taxable income by the tax rate: $300,000 (taxable income) x 0.20 (corporate tax rate) = $60,000 (tax owed).
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Conclusion
While no corporation can entirely escape federal income taxes, the choice of state significantly influences overall tax obligations. Currently, the states with no corporate tax include Wyoming, Nevada, South Dakota, Texas, Ohio, and Washington, while North Carolina offers the lowest corporate tax rate at 2.5%.
In contrast, New Jersey ranks as the state with the highest corporate tax burden at 11.5%, followed closely by Minnesota, Illinois, Alaska, and Pennsylvania.
Ultimately, it’s essential to weigh the advantages and disadvantages of each state. States with corporate taxes often offset lower rates with higher property or state-local taxes. Conduct thorough research to determine which state aligns best with your entrepreneurial needs.
Author
Jack Flynn is a writer for Zippia. In his professional career he’s written over 100 research papers, articles and blog posts. Some of his most popular published works include his writing about economic terms and research into job classifications. Jack received his BS from Hampshire College.
