What is franchise tax?

Some states implement a franchise tax on businesses for the privilege of being chartered or operating within their borders. Unlike a state income tax, which is calculated on the business's profit, franchise tax may not be tied to annual revenue.

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Alicia Tuovila

by Alicia Tuovila

Alicia Tuovila is an accounting and finance writer based in Tennessee. She holds an active Certified Public Accountan...

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Updated on: April 11, 2023 · 3 min read


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This article is for informational purposes. This content is not legal advice, it is the expression of the author and has not been evaluated by LegalZoom for accuracy or changes in the law.

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