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SESK: Stuff Everyone Should Know · sesk.info/biz-c-corp-21-percent

What is the federal income tax rate on a C corporation's taxable income?

21 percent, a flat rate.

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  1. 21 percent ✔
  2. 35 percent
  3. 15 percent

Why: Federal law sets the corporate income tax at a flat 21 percent of taxable income. Shareholders pay their own tax later on any dividends.

Huh, didn't know that: The 21 percent rate applies to tax years beginning after December 31, 2017.

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References

Answer: 21 percent. Federal law sets the corporate income tax at a flat 21 percent of taxable income. Shareholders pay their own tax later on any dividends.

  1. 26 U.S. Code 11, Tax imposed (Cornell LII) www.law.cornell.edu/uscode/text/26/11
    The amount of the tax imposed by subsection (a) shall be 21 percent of taxable income.
    Checked 2026-10-11.

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