Why Form a Corporation in Florida?

Florida Corporation Taxes and Fees

You’ll need to pay certain taxes and fees for your Florida S Corp or C Corp. We’ve included the more common ones below.

Common Fees for a Florida Corporation

1. Fees for forming a corporation in Florida: Learn about standard filing costs here for FL corporations.

2. Florida State Annual Report Fee: A yearly fee when you file your annual report.

3. Florida Permits and Licenses: These are the fees for creating or renewing your licenses and permits on a regular basis. These depend on the type of Florida corporation you’re operating and where you’re located.

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Taxes Payable by Your Florida Corporation

The way that Florida S Corporations and C Corporations pay taxes is different. We’ll take each one separately.

Both S Corporations and C Corporations in Florida Need to Pay These Taxes

Payroll Tax Payable to the IRS

Your Florida corporation will need to pay employer payroll tax to the IRS on salaries paid to employees.

Florida State Income Tax

Florida does not have a state income tax.

Florida State Sales and Use Tax

If your FL corporation is selling products or services in Florida, you may need to pay a state sales tax. Find out more on the Florida Department of Revenue website.

Other Taxes in Florida

You may need to pay other taxes and fees depending on the type of Florida corporation you run. Find out more on the Florida Department of Revenue website.

Estimated Taxes for Your Florida Corporation

Most Florida corporations will need to pay estimated taxes throughout the year, depending on the amount of income and profit you expect to make. The most common types of estimated tax are:

• Federal income tax

• Federal self-employment tax

• Florida state tax

Most Florida S Corporations and C Corporations will pay estimated taxes four times a year. Speak to your accountant for more information.

Florida Corporation Employee Taxes and Insurance

You may also need to pay tax and insurance for any employees, like employee compensation insurance or unemployment tax. There will also be other requirements you have for employees.

Get more requirements from the Florida [Department of Labor website. <link>

Individuals Working for Florida Corporations Are Liable for These Taxes

Florida Corporation Earnings, Dividends and Distributions Are Subject to Federal Income Tax

You will need to pay regular federal income tax when you file your tax return every year.

Florida S Corporations — Additional Tax Liabilities

Self-Employment Tax

In a Florida S Corporation, your earnings “flow through” from the business to your personal tax return. This means you must pay self-employment tax on those earnings at a rate of 15.3%. Note that you can deduct standard tax deductions and business expenses.

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You will be able to deduct your business expenses from your income when working out how much self-employment tax you owe. Here are some examples of how much self-employment tax you may need to pay, depending on your earnings:

• On profits of $10,000, you would pay self-employment tax of $1,530

• On profits of $40,000, you would pay self-employment tax of $6,120

• On profits of $70,000, you would pay self-employment tax of $10,710

• On profits of $100,000, you would pay self-employment tax of $15,300

• On profits of $140,000, you would pay self-employment tax of $21,420

In some cases, part of the income from an S Corporation can be paid as a “distribution” rather than “salary,” so it would not be subject to self-employment tax.

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Taxes Payable by Florida C Corporations

Corporation Tax

Florida C Corporations must file corporate tax returns with the IRS and pay corporation taxes on their profits. Shareholders must also pay tax on dividends received from a Florida C Corporation, which does result in “double taxation.”

Stock Dividends From C Corporations

A Florida C Corporation may pay shareholders dividends as a share of the profits of the company. The value of dividends that each shareholder is entitled to depends on how many shares they own.

Dividends that are distributed to shareholders are taxed twice: first at the corporate level as profit (on the corporation’s Form 1120) and again at the individual level as stock dividends (on the shareholder's Form 1040).

Ready to Start Your Florida Corporation?

Incfile provides a cost-effective service to help you create your Florida corporation. We guide you through the process and handle most of the administrative steps, such as filing the necessary forms on your behalf.

Our basic package also provides a free Registered Agent service for the first year. If you're looking for help starting an S Corporation or C Corporation, our comprehensive services provide outstanding value.

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