Georgia has moved quickly toward a low, flat income tax. In 2024 it replaced its six-bracket system with a single rate, and it has cut that rate each year since. For 2026, both corporations and individuals pay a flat 4.99%. Formation costs are low, the annual registration is $60, and Atlanta's economy is one of the fastest growing in the country.
This guide covers Georgia's business taxes for 2026, from income tax and the corporate net worth tax to sales, payroll and property taxes, with examples and comparisons.
Corporate income tax
Georgia taxes C corporations at a flat 4.99% of Georgia taxable income in 2026. The corporate rate is tied to the individual rate by statute, so both fall together.
- Apportionment: Single sales factor.
- Returns: Form 600 is due on the 15th day of the fourth month after year-end. Georgia allows a six-month extension.
- Credits: Georgia has one of the richest sets of business credits in the South, including job tax credits by county tier, research credits, port and investment credits, and the film tax credit.
- Federal conformity: Georgia adopts the Internal Revenue Code annually, but has historically decoupled from bonus depreciation, so depreciation schedules may differ from your federal return.
Net worth tax
In addition to income tax, Georgia corporations pay a net worth tax based on capital stock, paid-in surplus and retained earnings. The tax is graduated from $0 to a maximum of $5,000, and corporations with net worth of $100,000 or less are exempt. It is reported on the same Form 600. LLCs and partnerships do not pay net worth tax, but S corporations do, because they are still corporations under state law.
Personal income tax and pass-through owners
Georgia's flat 4.99% rate applies to all taxable income after deductions and exemptions. The personal exemption and standard deduction remove a modest amount of income from tax.
- Sole proprietors and LLC owners pay 4.99% of their Georgia taxable income.
- S corporation shareholders pay on their share of income.
- Nonresident owners pay on Georgia-source income, and partnerships must withhold for nonresident members or file composite returns.
- PTE election: Partnerships and S corporations can elect to pay the tax at the entity level, which is deductible federally.
Georgia also excludes a large amount of retirement income for older taxpayers, which helps retired owners who sell or wind down a business.
Sales and use tax
The state sales tax rate is 4%. Counties add local option, special purpose and education sales taxes, bringing the average combined rate to about 7.56%. In Atlanta the combined rate is 8.9%.
- Groceries are exempt from the state 4% but subject to local taxes.
- Services are mostly not taxed, which keeps the base narrow.
- Remote sellers with more than $100,000 of Georgia sales or 200 or more transactions must collect.
- Manufacturing exemptions cover machinery, energy used in manufacturing and certain inputs.
Payroll and property taxes
- Unemployment insurance: Employers pay state unemployment tax on the first $9,500 of each employee's wages. New employers generally start at 2.64%.
- Withholding: Employers withhold Georgia income tax at the flat rate.
- Property tax: Assessed at 40% of fair market value. Business personal property, including inventory, is taxable, with a freeport exemption for qualifying inventory in most counties.
- Local business licenses: Called occupation taxes in Georgia, often based on gross receipts or employee count.
Forming a business in Georgia: fees and ongoing costs
| Item | LLC | Corporation |
|---|---|---|
| Formation filing fee | $110 online | $110 online |
| Annual registration | $60 (due April 1) | $60 (due April 1) |
| Net worth tax | None | Up to $5,000; exempt at $100,000 net worth or less |
| Late registration penalty | $25 | $25 |
| Registered agent | Required | Required |
Corporations must also publish a notice of intent to incorporate in the county legal organ, which usually costs around $40.
Worked example: $500,000 of profit
| Step | Amount |
|---|---|
| Taxable income | $500,000 |
| Georgia corporate tax at 4.99% | $24,950 |
| Federal tax at 21% on $475,050 | $99,761 |
| Total income tax | $124,711 (24.9%) |
For a single LLC owner with $150,000 of Georgia taxable income, state tax is about $7,485. At $75,000 it is about $3,743.
How Georgia compares with its neighbors
| State | Corporate rate | Top personal rate | State sales tax |
|---|---|---|---|
| Georgia | 4.99% | 4.99% | 4% |
| Florida | 5.5% after $50,000 | None | 6% |
| Alabama | 6.5% | 5% | 4% |
| Tennessee | 6.5% excise | None on wages | 7% |
| North Carolina | 2% | 3.99% | 4.75% |
| South Carolina | 5% | 5.21% | 6% |
Georgia's flat 4.99% is competitive across the Southeast. North Carolina has a much lower corporate rate, and Florida and Tennessee have no personal income tax on wages, but Georgia's low sales tax and simple LLC costs keep it attractive.
Choosing an entity in Georgia
- LLC: Low formation and annual cost, and no net worth tax.
- S corporation: Same 4.99% for owners, plus potential federal payroll tax savings. S corporations do pay the net worth tax.
- C corporation: Combined rate of about 24.9% on retained earnings, plus net worth tax.
Because the rate is the same for corporations and individuals, Georgia's tax law has little effect on entity choice compared with federal considerations.
Tax planning tips for Georgia businesses
Use the job tax credits. Georgia ranks its counties into tiers based on economic need. A business creating jobs in a Tier 1 county can earn a credit of up to $4,000 per new job per year for five years, and credits in less developed areas can offset payroll withholding as well as income tax. Even metro Atlanta businesses can qualify for smaller credits.
Check depreciation differences. Because Georgia has decoupled from federal bonus depreciation, a business that writes off equipment immediately on its federal return will usually depreciate it over several years for Georgia purposes. Track both schedules to avoid errors when assets are sold.
Consider the freeport exemption. Many Georgia counties exempt inventory held for shipment out of state or used in manufacturing. Distribution and logistics companies near Atlanta and the port of Savannah should file the freeport application with the county each year.
Recent changes for 2025 and 2026
- Rate cut to 4.99% for 2026, the target set when Georgia adopted the flat tax.
- Tax rebates were paid again to individual filers from surplus revenue in 2025.
- Federal conformity: Georgia updated its Internal Revenue Code conformity date for 2026 but continues to decouple from some federal provisions.
Is Georgia a good state for business?
Advantages
- Low flat income tax for corporations and individuals
- Low state sales tax rate and inexpensive LLC maintenance
- Generous credits for jobs, research, film and logistics
- Hartsfield-Jackson airport and the port of Savannah
Drawbacks
- Net worth tax on corporations
- Decoupling from federal bonus depreciation
- Local occupation taxes vary by city and county
- Traffic and rising costs in metro Atlanta
Compliance checklist
- File Articles of Organization or Incorporation with the Secretary of State.
- Register with the Georgia Tax Center for sales tax, withholding and income tax.
- Register with the Department of Labor for unemployment insurance if you hire.
- Obtain a local occupation tax certificate from your city or county.
- File the annual registration between January 1 and April 1.
- File Form 600, 600S or 700 each year.
Compare Georgia with its neighbors below or estimate your taxes with the United States calculator. Learn more in Corporation taxes.