State Corporate Income Tax Rates 2025
Forty-four of the fifty United States impose corporate income tax. The lowest rate is from North Carolina at 2.25%, and the highest is from New Jersey at 11.5%. States changed their tax rates in different ways with New Mexico and New Jersey increasing their rates, while Louisiana, Nebraska, North Carolina, and Pennsylvania lowered their rates.
The average rate across all states is 6.5%, but there are plenty that implement rates that are higher. States that have rates higher than 9% include Alaska, Illinois, Minnesota, and New Jersey with California and Maine not far behind. On the contrary Arizona, Arkansas, Colorado, Indiana, Kentucky, Mississippi, Missouri, North Carolina, North Dakota, Oklahoma, South Carolina, and Utah all have top rates under 5%.
Nevada, Ohio, Texas, and Washington all impost gross receipts taxes instead of corporate income taxes. Delaware, Oregon, and Tennessee impost both gross receipts taxes and corporate income taxes. Of all 50 states, Wyoming and South Dakota are the only states to not impose either taxes.
Louisiana
Due to House Bill 2, the corporate income tax was reduced, along wth the elimination of several contorted exemptions. Prior to this bill, there was a three-bracket system with rates ranging from 3.5% to 7.5%. Also, HB 3 allowed for the state to eliminate franchise tax and a capital stock tax which will make their tax system more efficient.
Nebraska
Nebraska lowered their corporate income tax rate to a flat 5.2%, and is scheduled to reduce to 4.55% in 2026, and then 3.99% for years on or after January 1, 2027. Prior to this Nebraska had two tax brackets for those whose income is less than $100,000 at 5.58%, and 5.84% for the latter.
New Jersey
New Jersey has reimposed a 2.5% additional surtax on corporations with taxable income in excess of $10 million. This surtax is additional to their 9% marginal rate which starts at $100,000. This surtax does not apply to S corporations or public utilities.
North Carolina
North Carolina reduced their corporate income tax rate to 2.25% from their prior 2.5% which is part of a budget passed in 2021 to eliminate the tax by 2030. Although the rates here are low, they are one of the few states that still impose capital stock tax which is payable even if the corporation does not turn a profit.
