EricF Posted January 31, 2019 Report Posted January 31, 2019 The calculation of NC franchise tax for S corporations has changed, effective for 2018 returns paying 2019 franchise tax. (North Carolina franchise tax is always prospective.) The former law applied a rate of $1.50 for every $1,000 of taxable value. The change is to have a $200 franchise tax for taxable value up to $1 million, and $1.50 for each $1,000 over $1 million. The ATX returns are not applying the new rates, so if you want to file an S corporation return, you need to compute and override the franchise tax in box 5 on page 1 of Form CD-401S. I have contacted ATX support and asked them to pass the information to the developers. 1 Quote
Abby Normal Posted January 31, 2019 Report Posted January 31, 2019 It was $200 last year when I did my first NC S corp, plus a $20 annual report fee. I gave my client the option of doing the annual report themselves online: https://www.sosnc.gov/divisions/business_registration/annual_report Quote
EricF Posted January 31, 2019 Author Report Posted January 31, 2019 I neglected to say that, as in past years, the minimum franchise tax is $200. That has not changed. The annual report fee is no longer paid to the North Carolina Department of Revenue on a tax form. Filing with and paying the North Carolina Secretary of State is the only option for paying the annual report fee. Quote
Abby Normal Posted January 31, 2019 Report Posted January 31, 2019 Ah, thanks for the clarification for us n00bs. Quote
Abby Normal Posted January 31, 2019 Report Posted January 31, 2019 Did you let ATX know the form is wrong? Quote
EricF Posted January 31, 2019 Author Report Posted January 31, 2019 Yes, I did. The support person said she would pass it along, and didn't know if they were already working on that change for the next update. Quote
Abby Normal Posted January 31, 2019 Report Posted January 31, 2019 Great! Thanks! I also just posted the issue in the official forum: https://community.atxinc.com/forums/thread/270593.aspx Quote
Abby Normal Posted February 6, 2019 Report Posted February 6, 2019 The form just updated and I'm not sure if it's fixed. I put in a net worth of 500,000 and I'm getting zero franchise tax on line 5. Quote
EricF Posted February 7, 2019 Author Report Posted February 7, 2019 I removed the override on the return where it was computing a franchise tax of greater than $200, and it's now computing $200 correctly. For kicks, I put in $1,000,000 value and still get $200. At $1,100,000, it's $350, which is also right. I think they have fixed it. 1 Quote
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