Articles Tagged with tax

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Autumn LeavesFall has finally arrived in sunny California. For weeks, we have witnessed the shortening rays of the sun’s glorious light. Now, as the leaves explode in color to red, orange and yellow hues, we know that the holiday season is but a few weeks away.

For some, the holiday season can be stressful. How much turkey should I prepare for Thanksgiving dinner? Can I recycle a resolution from a previous New Year’s day? But one question that should be easier to answer this year is how much money to allocate to health flexible spending arrangements (FSAs).


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Last month, the New York Times featured an article on how G.E.’s Strategies Let It Avoid Taxes Altogether. With Tax Day, just around the corner, I wanted to take a closer look at how much corporations were exactly paying in taxes.

The starting point for this exercise begins with the Instructions for Form 1120, where the Internal Revenue Service lists the income tax rates for U.S. corporations.

Tax Rate Schedule
If taxable income is:
Over But not over Tax is: Of the amount over
$0 $50,000 15% $0
50,000 75,000 $7,500 + 25% 50,000
75,000 100,000 13,750 + 34% 75,000
100,000 335,000 22,250 + 39% 100,000
335,000 10,000,000 113,900 + 34% 335,000
10,000,000 15,000,000 3,400,000 + 35% 10,000,000
15,000,000 18,333,333 5,150,000 + 38% 15,000,000
18,333,333 35% 0

$18.3 million in taxable income is a relatively low threshold, at least when referring to major corporations. How many of them pay any where close to the 35% tax rate? Let’s take a look. Unlike the new York Times article, I will show my calculations so that you can comment on my methodology.


Posted in: Laws