- The corporate tax rate reduced from 4 percent to 3 percent. North Carolina offers one of the lowest tax environs for corporations in the nation. The opposite was true prior to 2013 when the corporate tax rate was 6.75 percent. As of this writing, The Tax Foundation ranks North Carolina as #16 nationally for the best business tax climate.
- The income tax rate reduced from 5.75 percent to 5.5 percent. As above, the changes are a growing shift away from the tax requirements pre-2013 when the top personal income tax rate in North Carolina was 7.75 percent.
- The standard deduction for singles and married couples filing separately increased from $8,250 to $8,750, while the deduction for married couples filing jointly increased from $16,500 to $17,500, and head of household increased from $13,200 to $14,000.
While adjustments above all appear favorable, new taxes have been imposed and others have risen. In addition to a new motor fuel tax, all maintenance, repair and installation providers who service real property must now collect and pay sales tax on these services. This includes plumbing, electrical work, HVAC, remodeling, and similar services. (Landscaping and new construction are exempt.) Also, the toll for the Triangle Expressway rose 3.5 percent.
Questions about tax matters in North Carolina? Contact our Chapel Hill tax attorneys.