In this page: Corporate Taxes | Accounting Rules | Consumption Taxes | Individual Taxes | Double Taxation Treaties | Sources of Fiscal Information
Corporate Income Tax | Federal corporate income tax is applied with a flat rate of 21% to the effectively connected income (ECI). State and local governments may also impose income taxes (generally ranging between 1% and 12%), thus the effective tax rate in each state. Click here for more information about corporate tax rates. |
S Corporations Tax | Corporations with up to 100 eligible shareholders (none of whom may be corporations) that meet certain specific requirements are generally not subject to US federal income tax. |
”Base Erosion and Anti-Abuse Tax” (BEAT) Applies only if the US corporation or branch has (I) a “base erosion percentage” of 3% or more (2% for certain banks and securities dealers), and (II) average annual gross receipts of at least USD 500 million for the three-year period ending with the preceding taxable year. |
equal to the excess of (I) a fixed percentage of modified taxable income (5% for taxable years beginning in 2018, increased to 10% as from taxable years beginning in 2019), over (II) the regular tax liability reduced by certain tax credits. |
Foreign companies are however subject to a branch profits tax at 30% of ECI that is not invested in U.S. trade or business and a 30% withholding tax on non-ECI U.S.-source income (e.g. dividends, interests, rents and royalties). Other arrangements can be made through tax treaties. A 30% branch profits tax also will be imposed on interest payments by the U.S. branch to foreign lenders.
Foreign companies are generally exempt from capital gains tax unless the gain is U.S.-sourced (from U.S. real property or through U.S. trade or business).
Importers, manufacturers, and sellers of ozone-depleting chemicals, or imported products manufactured using such chemicals, are subject to environmental taxes calculated per weight of the ODC.
In addition to federal taxes, state and municipal taxes vary from one state or community to another, including property taxes on real property, stamp duties, franchise taxes and taxes on the capital of a corporation. For more details, consult the Tax Foundation website.
United States | OECD | Germany | |
---|---|---|---|
Number of Payments of Taxes per Year | 10.6 | 10.1 | 9.0 |
Time Taken For Administrative Formalities (Hours) | 175.0 | 163.6 | 218.0 |
Total Share of Taxes (% of Profit) | 36.6 | 41.6 | 48.8 |
Source: Doing Business - Latest available data.
The five states with the highest average combined state and local sales tax rates are Louisiana (9.55%), Tennessee (9.547%), Arkansas (9.48%), Washington (9.29%), and Alabama (9.22%). For the full list of applicable rates, click here.
Excise duties are levied at federal and state level on a wide range of goods and activities, including gasoline and diesel fuel used for transportation, air transportation, wagering, foreign insurance, certain sporting goods, firearms and ammunition, alcohol, tobacco, and selling certain goods at retail (e.g. heavy vehicles, trailers, bodies, and chassis).
Individuals who meet a “substantial presence test” are considered residents for taxation purposes. Such test requires either physical presence in the country for 183 days or more during a calendar year, or presence of at least 31 days during a calendar year and a cumulative presence of 183 days or more based on a weighted number of days during the calendar year (taken at whole value) and the two immediately preceding calendar years (taken at one-third value for the first preceding calendar year and at one-sixth for the second).
Different scales depending on the family status (married couples under a joint system, married couples under a separate assets system, single and head of the family), limited to seven rates. | 2022 Federal Income Tax Rates: 10%, 15%, 25%, 28%, 33%, 35% and 37% |
Single payers (USD) | Tax Rate |
0 to 10,275 | 10% |
10,276 to 41,775 | 12% |
41,776 to 89,075 | 22% |
89,076 to 170,050 | 24% |
170,051 to 215,950 | 32% |
215,951 to 539,900 | 35% |
539,901 or more | 37% |
Married Filing Jointly (USD) | Tax Rate |
0 to 20,550 | 10% |
20,551 to 83,550 | 12% |
83,551 to 178,150 | 22% |
178,151 to 340,100 | 24% |
340,101 to 431,900 | 32% |
431,901 to 647,850 | 35% |
Above 647,851 | 37% |
Married filling separately (USD) | Tax Rate |
0 to 10,275 | 10% |
10,276 to 41,775 | 12% |
41,776 to 89,075 | 22% |
89,076 to 170,050 | 24% |
170,051 to 215,950 | 32% |
215,951 to 323,925 | 35% |
323,926 or more | 37% |
Head of Household (USD) | Tax Rate |
0 to 14,650 | 10% |
14,651 to 55,900 | 12% |
55,901 to 89,050 | 22% |
89,051 to 170,050 | 24% |
170,051 to 215,950 | 32% |
215,951 to 539,900 | 35% |
539,901 or more | 37% |
Alternative Minimum Tax (AMT) (applies if an individual’s tentative AMT liability exceeds that individual’s regular income tax liability.) |
26% up to a taxable income of USD 206,100 (USD 103,050 for married individuals filing separately) 28% on the amount in excess The AMT exemption amount for 2022 is USD 75,900 for singles and USD 118,100 for married couples filing jointly |
State and local income taxes | Most states, and a number of municipal authorities, impose income taxes on individuals working or residing within their jurisdictions. For more information, visit the IRS website. |
Citizens and resident aliens may also claim a standard deduction (instead of itemising deductions). The basic standard deduction for 2022 is USD 12,950 for individuals, USD 25,900 for married couples filing a joint return, and USD 19,400 for heads of households. Individuals, including resident aliens, who are blind or age 65 or over are entitled to an extra standard deduction, as follows: USD 1,400 if married, USD 1,750 if single.
Visit the IRS site for more detailed information.
For employees, in 2022 social security tax (old-age, survivors, and disability) is levied at a rate of 6.2% on the first USD 142,800 of wages paid, whereas the Medicare hospital insurance tax is levied at 1.45%.
A federal estate tax is levied on the fair market value of assets that an individual owns at death. For non-resident non-citizens, estate taxes are imposed only on property situated in the U.S. in excess of USD 60,000. Furthermore, for U.S. citizens and residents, a gift tax is imposed on gifts made during a person’s life, and it is unified with the estate tax. The top estate, gift, and generation-skipping transfer tax rate is 40%.
Individuals must pay a 3.8% tax on net investment income over a threshold amount and a 0.9% tax on wages, compensation, or self-employment income that exceeds a threshold amount (varying according to the taxpayer's status: single, married filing separately/jointly, etc.).
Documentary stamp taxes may be imposed at the state level, but there are no stamp duties at the federal level.
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Latest Update: June 2023