Everyone dreads having to pay their fair share of federal taxes, but there are some multi-million dollar companies that do not pay a dime in taxes. Some of the wealthiest companies have not had to pay federal taxes in years, and 2018 was no exception. Some of the top companies, like Amazon, Alaska Airlines, Netflix, and many more, did not have to pay anything in federal income taxes this past year.
Recent findings have found that there were 60 of the top Fortune 500 companies that did not have to pay any federal tax in 2018. These companies did not break the law or bribe government employees, rather they used loopholes in the tax laws to keep their money in their own pockets. They were able to eliminate tax liabilities and write off their capital investments. They used knowledgeable and experienced groups of accountants to reap the benefits of their rewards so that they did not have to owe the government any money in 2018.
Some of these companies got a refund from the government that they then used to invest back into their company. The wealthiest company in the world, Amazon, made 11 billion dollars in the United States and received a refund of 129 million dollars in 2018 from the federal government. Alaska Airlines also received a five million dollar federal rebate.
While these companies may not have to pay federal income taxes they do pay their corporate taxes around the world where they have offices and clients. These companies pay millions of dollars each year in corporate taxes. In 2018 Amazon reported paying 2.6 billion dollars in corporate tax around the world.
While these companies do hire a lot of employees around the country the issue is taking center stage in some politicians campaigns. Everyone has their own opinion about the matter and is trying to make sure their voice is heard. Both parties are finding every situation to take advantage of as the political campaigns start to form.
Some of the largest companies in the country did not have to pay any taxes in 2018, but most of the companies say it is because even though their businesses are very successful their profits are actually modest. These Fortune 500 companies are in extremely competitive markets and to keep their companies successful they have to offer low prices on millions of goods. This ensures that they have a large number of customers and a large number of sales. The larger the business gets the more employees they hire, the more money they spend on marketing, and the more money they have to spend on returns and packaging. These things help to keep the company growing, but also keep the profit margins modest, in the eyes of the company.
There are many things that affect a company’s need to pay federal income taxes and companies are finding every loophole in tax laws to keep their profits in their company. Companies often use stock options to pay employees. This helps keep cash in their business, but they can claim it as money spent. Companies also use tax credits throughout the year to reduce the amount they will owe in April. There are also accelerated depreciation tax breaks in the new tax laws that allow many companies in the Fortune 500 list to have additional tax breaks.