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    Accteam's Avatar
    Accteam Posts: 1, Reputation: 1
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    #1

    Mar 3, 2012, 02:14 PM
    State and federal Tax for C Corp
    I'm new to C Corp taxation. C Corp can deduct the state tax paid from the federal tax? If so, where on form 1120 should I enter the amount.
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    MLSNC's Avatar
    MLSNC Posts: 158, Reputation: 17
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    #2

    Mar 3, 2012, 06:05 PM
    The state income taxes are deducted on the Taxes and Licenses line which is Line 17. If you are cash basis deduct the amount you have paid. If you are accrual basis you will deduct the taxes for the current year. Note that most states do not allow state income taxes to be deducted so they will be added back somewhere on the state form.
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