Jun. 9 2011
3

Estimating US Corporation Income Tax in Excel

I recently found myself having to estimate income tax for my U.S.-based corporation. So, I made an Excel formula to handle it for me.

It takes the taxable income (you’re on your own for that, but you can reference the IRS’s instructions for form 1120) and puts it against the brackets listed in the publication. For sanity’s sake, I’ve rounded to the nearest multiple of 50 (so, if it’s $104, it’s rounded to $100 or if it’s $174, it’s rounded to $200).

=MROUND(IF(C13<0, 0, IF(C13<50000, C13*0.15, IF(C13<75000, 7500+((C13-50000)*0.25), IF(C13<335000, 1375+((C13-75000)*0.34), if(10000000<c13, 113900+((c13-335000)*.34), if(15000000>c13, 3400000+((c13-10000000)*0.35), if(c13<18333333, 5150000+((c13-5150000)*.38), c13*.35)))))), 50)

Remember, I’m not a tax professional so take these estimates with a grain of salt. You’ll need to make sure you follow all the rules about deductions and such to first estimate your taxable income before this is of any use.

Enjoy!

3 comments

  1. Kevin M
    July 23, 2014 at 7:33 am

    You had an error that I fixed, missed the 39%. I also adjusted your above 10M IF formulas, as you switched from less than to greater than. This is the max amount of nested IF’s allowed in my version of excel (i believe it is 2010), so I could not include the round in this formula.

    ‘=(IF(G5<0,0,IF(G5<50000,G5*0.15,IF(G5<75000,7500+((G5-50000)*0.25),IF(G5<100000,13750+((G5-75000)*0.34),IF(G5<335000,22250+((G5-100000)*0.39),IF(G5<10000000,113900+((G5-335000)*0.34),IF(G5<15000000,3400000+((G5-10000000)*0.35),IF(G5<18333333,5150000+((G5-5150000)*0.38),G5*0.35)))))))))

  2. Barry
    September 28, 2014 at 6:41 pm

    I think the formula in the comment dated July 23, 2014 still has an error. It’s in the bracket for $15,000,000 to $18,333,333. The correct formula (without rounding) should be:

    =(IF(E101<0,0,IF(E101<50000,E101*0.15,IF(E101<75000,7500+((E101-50000)*0.25),IF(E101<100000,13750+((E101-75000)*0.34),IF(E101<335000,22250+((E101-100000)*0.39),IF(E101<10000000,113900+((E101-335000)*0.34),IF(E101<15000000,3400000+((E101-10000000)*0.35),IF(E101<18333333,5150000+((E101-15000000)*0.38),E101*0.35)))))))))

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