Compliance in the USA: C Corporation obligations by state

The rules governing the C Corporation are largely the same, or at least very similar, in every US state. But as always, the devil is in the details.

In this section we look at the requirements of the individual states. At the end, you will also find a summary table with the key facts on the C Corporation in each US state.

1Formation time

How long it takes to form a C Corporation differs from state to state. Depending on the state, anything from 2 days to two weeks is normal. Because government offices can always cause delays, we run the process with active follow-up: when needed, we call the agencies directly so your filing is processed as fast as possible.

2Formation fees

Formation fees also vary widely between states. Fees between $90 and $300 are typical.

3Public disclosure in the state register

In some states, the personal details of the C Corporation's directors are published in the state business register and anyone can look them up. Other states publish no information at all. Shareholder details are not recorded by the authorities. You will find an overview by state in the table at the end of this page.

4Tax return

There is a basic distinction between the federal tax return and a separate state tax return.

A C Corporation pays federal corporate income tax in the US (21%), plus any corporate tax levied at state level. Dividends are then taxed again: US shareholders pay capital gains tax (0-37%, depending on holding period and tax bracket); on distributions to foreign shareholders, the corporation withholds 30% tax, which a tax treaty can reduce.

The corporate tax return for the previous year is due by April 15. An extension to October 15 is easy to get. Most states also require an annual report, and a corporation that is at least 25% foreign-owned files Form 5472 if it had reportable transactions with related parties.

5Bylaws

The rules on the governing agreement differ between US states, and also by type of entity. For the C Corporation, some states require bylaws by law and others do not; the latter include California, Nevada, Pennsylvania and 12 more.

Like the governing agreements of other entity types, the bylaws put the arrangements between the members in writing. They protect each partner if disputes arise. That is why we advise every client to draw up bylaws.

As a rule, the bylaws do not have to be filed with the state register anywhere.

6Annual report

Rules on annual reports differ by state and entity type. Most states require one for the C Corporation, but some do not (Ohio, for example, has no annual report). Don't confuse the annual report with a tax return. The annual report is simply a filing with the state register confirming the company details on record (such as registered address, management and business purpose).

Some states require a report every two years instead of every year. Our service covers the annual fee for preparing and filing the annual report as well as the state fees.

7Annual fees

Annual fees for the C Corporation also differ between states. Some states only charge a fee when you file the annual report. Others charge an additional franchise tax.

8Overview table

The table below summarizes each state's legal requirements on the points covered here:

For more on company formation, see our overview page Formation. The equivalent requirements for the other entity types are covered in US LLC compliance and US LP compliance; how the C Corporation is taxed is explained on Taxation of the US Corporation.

In short

• The rules for the C Corporation are similar in every state, but they differ in formation time, fees, disclosure, annual reports and annual taxes.
• At the federal level, the C Corporation pays 21% corporate income tax, some states add their own tax, and dividends are taxed again in the shareholder's hands.
• The corporate tax return for the prior year is due by April 15, and an extension to October 15 is easy to get.
• The annual report is not a tax return: it confirms the company's details to the state registry, and some states only require it every two years.
• You never file your bylaws anywhere. Even so, we advise every client to put them in writing.

How we help you

• Form a CorporationThe US corporation (Inc) for growth, investors and your visa.
• Corporation tax returnForm 1120 and Form 5472 for your US corporation.
• Apply for an EINYour company's US tax ID, applied for by us.
• US Company FormationLLC, Inc or LP in Delaware, Florida, California, New York, Texas or Wyoming.
• Company formation consultationEntity type, state and tax consequences, before you commit.