2019 Corporate Tax Rate
The 2019 Corporate Tax Rate is 21%.
Effective 2019-01-01Source: 2019 Instructions for Form 1120 (IRS)Verified 2026-09-04
Compared with 2018
Every figure on this page is unchanged from 2018.
| Item | 2018 | 2019 | Change |
|---|---|---|---|
| Rate | 21% | 21% | +0% (+0.0%) |
Who it applies to
C corporations filing Form 1120 for tax year 2019
What changed this year, and why
The corporate income tax rate is a flat 21% for tax year 2019.
Common questions
- Did the corporate tax rate change from 2018 to 2019?
- No. The rate was 21% in 2018 and remained 21% in 2019.
Which entities pay this rate, including an LLC that elects it
The 21% corporate tax rate applies to C corporations filing Form 1120. Limited liability companies (LLCs) are generally treated as partnerships or disregarded entities by default, but an LLC can elect to be treated as a corporation for federal income tax purposes. To make this election, the LLC must file Form 8832, Entity Classification Election, and attach a copy of Form 8832 to its Form 1120 for the year of the election. Once the election is made, the LLC is taxed as a C corporation and pays tax at the 21% rate on its taxable income. Single-member LLCs are typically disregarded and report on the owner's return, while multi-member LLCs file as partnerships unless they elect corporate treatment. The entity classification election allows LLCs to choose the tax treatment that best fits their business needs.
The LLC can file a Form 1120 only if it has filed Form 8832 to elect to be treated as an association taxable as a corporation.
2019 Instructions for Form 1120, U.S. Corporation Income Tax Return (IRS)
The filing deadline, and the extension
A corporation must generally file its income tax return by the 15th day of the 4th month after the end of its tax year. For calendar-year corporations, this means the return is due by April 15. A corporation with a fiscal tax year ending June 30 must file by the 15th day of the 3rd month after the end of its tax year. If the due date falls on a Saturday, Sunday, or legal holiday, the corporation can file on the next business day. A corporation that needs more time can request an automatic extension by filing Form 7004, Application for Automatic Extension of Time To File Certain Business Income Tax, Information, and Other Returns. The corporation must file Form 7004 by the regular due date of the return. The extension gives the corporation additional time to file its return, but any tax owed must still be paid by the original due date to avoid interest and penalties.
Generally, a corporation must file its income tax return by the 15th day of the 4th month after the end of its tax year.
2019 Instructions for Form 1120, U.S. Corporation Income Tax Return (IRS)
Corporations pay the tax in four installments
Corporations must pay estimated tax in four quarterly installments if they expect their total tax for the year, minus applicable credits, to be $500 or more. The installments are due by the 15th day of the 4th, 6th, 9th, and 12th months of the tax year. If any due date falls on a Saturday, Sunday, or legal holiday, the installment is due on the next regular business day. The corporation must use electronic funds transfer to make all estimated tax payments. Corporations should use Form 1120-W as a worksheet to figure the correct estimated tax amounts. Penalties may apply if required estimated tax deposits are not made on time, including cases where the corporation failed to pay at least the smaller of its current year tax or its prior year tax. If a corporation overpaid its estimated tax, it may request a quick refund by filing Form 4466.
Generally, the following rules apply to the corporation's payments of estimated tax. • The corporation must make installment payments of estimated tax if it expects its total tax for the year (less applicable credits) to be $500 or more. • The installments are due by the 15th day of the 4th, 6th, 9th, and 12th months of the tax year. If any date falls on a Saturday, Sunday, or legal holiday, the installment is due on the next regular business day. • The corporation must use electronic funds transfer to make installment payments of estimated tax.
2019 Instructions for Form 1120, U.S. Corporation Income Tax Return (IRS)
Personal service corporations pay at the same rate
Personal services include any activity performed in the fields of accounting, actuarial science, architecture, consulting, engineering, health, law, and the performing arts. The services must be substantially performed by employee-owners. Personal service corporations are subject to the same 21% corporate tax rate as other C corporations. To compute the tax, the corporation multiplies its taxable income by 21% and enters this amount on line 2 of Form 1120. This flat rate applies to all C corporations regardless of whether they are personal service corporations. The testing period for determining if a corporation is a personal service corporation is generally the prior tax year, unless the corporation has just been formed. A personal service corporation must generally use a calendar tax year unless it qualifies for an exception under section 444 or can establish a business purpose for a different tax year.
A personal service corporation is a corporation whose principal activity for the testing period is the performance of personal services.
2019 Instructions for Form 1120, U.S. Corporation Income Tax Return (IRS)
What filing late costs
A corporation that does not file its tax return by the due date, including extensions, may be penalized 5% of the unpaid tax for each month or part of a month that the return is late. This failure-to-file penalty accumulates monthly but cannot exceed 25% of the unpaid tax in total. If the return is more than 60 days late, a minimum penalty applies equal to the smaller of the tax due or $435. The penalty will not be imposed if the corporation can demonstrate that the late filing was due to reasonable cause rather than willful neglect. A separate late payment penalty also applies to unpaid tax balances, calculated as a percentage of unpaid tax per month up to a maximum of 25% of the unpaid tax. Interest accrues on both the tax owed and any penalties from the original due date until payment is made in full.
Late filing of return. A corporation that does not file its tax return by the due date, including extensions, may be penalized 5% of the unpaid tax for each month or part of a month the return is late, up to a maximum of 25% of the unpaid tax. The minimum penalty for a return that is more than 60 days late is the smaller of the tax due or $435. The penalty will not be imposed if the corporation can show that the failure to file on time was due to reasonable cause.
2019 Instructions for Form 1120, U.S. Corporation Income Tax Return (IRS)
What the 21% actually multiplies
The 21% rate applies to taxable income, not to total revenue or gross receipts. Taxable income is the amount left after the corporation subtracts all allowable deductions - such as ordinary business expenses, depreciation, and net operating loss carryovers - from its gross income. This distinction matters because a company with large gross receipts but thin margins may owe far less than 21% of its top-line revenue. On Form 1120, the corporation computes taxable income on page 1, line 30, then multiplies that figure by 21% and enters the result on line 2 of the tax computation. The rate is a flat percentage; there are no graduated brackets for the 21% corporate income tax that has applied since 2018. Controlled-group members must use Schedule O (Form 1120) to apportion certain tax benefits among themselves, but each member still applies the 21% rate to its own share of taxable income.
Multiply taxable income (page 1, line 30) by 21%. Enter this amount on line 2.
2019 Instructions for Form 1120, U.S. Corporation Income Tax Return (IRS)
The accumulated earnings tax rate, and the general safe harbor
A corporation that lets its earnings accumulate beyond the reasonable needs of the business may owe an accumulated earnings tax of 20% on the amount accumulated, on top of the regular 21% corporate rate. If the tax applies, interest runs on it from the date the corporate return was originally due, without regard to any extension. Publication 542 sets a general safe harbor: an accumulation of $250,000 or less is generally treated as within the reasonable needs of most businesses, so the tax reaches accumulations above that amount.
if a corporation allows earnings to accumulate beyond the reasonable needs of the business, it may be subject to an accumulated earnings tax of 20%. If the accumulated earnings tax applies, interest applies to the tax from the date the corporate return was originally due, without ex- tensions. To determine if the corporation is subject to this tax, first treat an accumulation of $250,000 or less generally as
Publication 542 (Rev. January 2024), Corporations (IRS)
How each figure was verified
Each number below was read from a stored copy of the document named beside it, and checked to occur word for word in the quoted sentence. The digest is of that stored text.
2019 Instructions for Form 1120 (IRS)
- Rate
Multiply taxable income (page 1, line 30) by 21%. Enter this amount on line 2.