Similar to the income tax brackets and rates, the tax laws have defined slabs and rates for corporations as well. The corporate tax which is calculated on the amount earned as profit by any corporation depends on the tax rate which is applied.
According to the rates and brackets defined for year 2010, there are 8 tax brackets in all each having a corresponding tax rate. The first tax bracket is income up to $50,000 and has a tax rate of 15 percent. For the next income slab between $50,000 and $75,000, the tax is calculated on the income over $50,000 at 25 percent and is added up with $7500 to give the total tax amount.
Similarly, for every tax bracket which succeeds the first, a pre-calculated tax amount has been already defined. For calculation purposes, the amount more than the lower limit of a particular bracket is taken into consideration and tax is calculated on it according to the mentioned tax rate.
This amount is then added to the pre-defined amount which eventually gives the total corporate tax. The third tax bracket is $75,000 to $100,000 with a corresponding tax rate of 34 percent. With a tax rate of 39%, $100,000 to $335,000 is the next income slab. The fifth tax bracket ranges from $335,000 to $1,000,000 and has a tax rate of 34 percent. For the sixth tax slab, the income range is between $1,000,000 to 15,000,000 and the tax rate is 35 percent. The next tax bracket is $15,000,000 to $18,333,333 and the tax rate is 38 percent. The last tax bracket is income more than $18,333,333 and has a flat tax rate of 35 percent.
This is the tax structure for corporate taxes in the United States. The annual taxes for any corporation are calculated on the basis of these brackets and rates with the help of mentioned guidelines.