Franchise Tax Calculator

Franchise tax is a state-level entity tax — paid for the privilege of doing business in a state, independent of profit. This calculator models the common structure (asset base × rate, subject to floor and cap) and flags when you hit the min or max. Useful for multi-state real estate entities planning annual obligations.

Assets / capital base

Franchise tax rate

Minimum franchise tax

Maximum franchise tax (cap)

Annual gross revenue (some states)

Franchise tax owed

$15,000

Uncapped calculation

$15,000

Tax as % of revenue

1.250%

At minimum floor

At maximum cap

How the math works

Franchise tax is a state-level tax on the privilege of doing business — not a tax on income. Rates vary: CA minimum $800/year; DE uses asset-based tiers up to $200K+; TX uses margin tax at 0.375% of revenue. Real estate partnerships often pay multiple state franchise taxes when holding property across states.

Franchise tax is often the biggest 'hidden' annual cost in multi-state REITs and partnerships. Budget early — some states bill on January 1 regardless of whether the entity was profitable.

How to Use

Enter asset / capital base for the calculation.
Enter the state's franchise tax rate.
Enter minimum and maximum limits.
Read franchise tax owed.

Frequently Asked Questions

States with franchise tax?

CA, DE, NY, TX, NC, IL, PA, TN, and more. Rates vary enormously. CA has $800 minimum; DE can exceed $200K on large entities; TX uses margin tax differently. Multi-state investors pay multiple franchise taxes each year.

Real estate exemptions?

Rarely — most franchise tax regimes hit LLCs, corps, LPs, and partnerships regardless of real estate status. Some states exempt disregarded SMLLCs owned by individuals. Always verify with state rules.

When to pay?

Annual, typically by the end of the first month or quarter of the following year. CA pays by April 15. DE pays by March 1. Set calendar reminders — penalties stack fast.