Georgia — Corporate Income / Franchise Tax

Georgia imposes a corporate income tax on every domestic corporation and every foreign corporation that owns property in Georgia, does business in the state, or receives income from Georgia sources. Effective for taxable years beginning on or after January 1, 2026, the tax is imposed on the corporation's Georgia taxable net income at a rate of 4.99%. This rate was reduced from 5.19% pursuant to House Bill 463 (2026), which directly amended the statutory rate for 2026 and subsequent tax years. Prior to this legislation, the tax rate for tax years beginning before January 1, 2026, was 5.19% following the rate reduction authorized by House Bill 111 (2025).

Georgia taxable net income starts with the corporation's federal taxable income and applies Georgia-specific additions and subtractions. If an S corporation election is recognized for Georgia purposes, the shareholders pay the tax rather than the corporation itself.

Source: Corporate Income and Net Worth Tax, Georgia Department of Revenue Source: HB 463—Georgia Economic Growth and Tax Relief Act of 2026, signed text

Georgia corporate income tax returns are due by the 15th day of the fourth month following the close of the tax year. For calendar-year C corporations, this means April 15. S corporation returns (Form 600-S) are due by the 15th day of the third month following the close of the tax year—March 15 for calendar-year filers. Corporations may request a six-month filing extension by filing Form IT-303 or by obtaining a federal extension via IRS Form 7004; however, an extension to file does not extend the time to pay any tax liability, which remains due on the original due date.

Source: Tax Due Dates, Georgia Department of Revenue

IMPORTANT UPDATE: Schedule made moot by HB 463 (2026).

The rate reduction mechanism, annual step-down schedule, and revenue trigger process established in House Bill 111 (2025) for corporate income tax rates after 2025 has been superseded and rendered moot by House Bill 463 (2026). HB 463 directly amends O.C.G.A. § 48-7-20(a.1) to set the corporate income tax rate at 4.99% for tax years beginning on or after January 1, 2026. The fixed statutory rate now applies by law, regardless of the trigger mechanism and phased reductions previously outlined in HB 111. Practitioners should refer to HB 463 and the codified O.C.G.A. § 48-7-20(a.1) for the controlling authority regarding the rate after 2025. See the dedicated section of this guide for details on HB 463’s override and its implications.

---

Background—HB 111 (2025) stepdown schedule (operative only for 2025):

For tax years beginning on or after January 1, 2025 (but before 2026), Georgia imposed a flat corporate income tax rate of 5.19 percent. HB 111, enacted in 2025, reduced the corporate income tax rate from 5.39 percent to 5.19 percent and created an annual 0.10 percentage point reduction mechanism—originally scheduled to reach 4.99 percent by 2027, contingent on satisfying annual revenue trigger tests administered by the Georgia Office of Planning and Budget. This process reflected the language of HB 111 and was memorialized in session summaries and related DOR publications in effect until mid-2026.

Why is this process moot?

HB 463 (2026) superseded HB 111’s future scheduled reductions and triggers by setting the rate at 4.99% for tax years beginning in 2026 and subsequent years. There is no longer any statutory contingency or OPB determination required for the flat 4.99% rate as set by HB 463. Practitioners should disregard the past trigger process for 2026 forward; the only operative rate and authority are now O.C.G.A. § 48-7-20(a.1) as amended by HB 463 (2026).

Source: 2025 Georgia House of Representatives Session Report, HB 111 (Final Bill Summary) Source: HB 463—Georgia Economic Growth and Tax Relief Act of 2026, signed text Source: Corporate Income and Net Worth Tax, Georgia Department of Revenue

A corporation is subject to Georgia corporate income tax if it owns property in Georgia, does business in Georgia, or receives income from Georgia sources. "Doing business" means engaging in any activities or transactions within Georgia for financial profit or gain. Having an employee in the state generally creates nexus. Corporations that only solicit orders for sales of tangible personal property, with orders approved and filled from outside Georgia via common carrier, may be protected from income tax under federal Public Law 86-272, but this exemption does not apply if employees perform activities beyond mere solicitation. P.L. 86-272 does not exempt corporations from Georgia's net worth tax, which has separate nexus standards.

Source: C Corporations - FAQ, Georgia Department of Revenue

Georgia taxable net income starts with a corporation's federal taxable income and applies Georgia-specific additions and subtractions before apportionment. The modifications address income items that are treated differently for federal and state tax purposes. The major additions and subtractions are set forth in O.C.G.A. (Official Code of Georgia Annotated) § 48-7-21(b).

State and local income tax addback. Corporations must add back to taxable income any taxes on or measured by net income or net profits that were deducted in computing federal taxable income. This includes income taxes paid or accrued to the United States, any foreign country, any state except Georgia, and any political subdivision of a state, territory, or foreign country. The addback ensures Georgia does not subsidize other jurisdictions' income taxes. Because Georgia's own income tax is not deductible for federal purposes, no addback is required for Georgia income tax.

Related-party intangible and interest expense addback. Under O.C.G.A. § 48-7-28.3, a corporation must add back otherwise deductible interest expenses and costs and intangible expenses and costs that are directly or indirectly paid, accrued, or incurred to or in connection with one or more related members. "Intangible expenses and costs" include royalty, patent, technical, and copyright fees, as well as expenses for the acquisition, use, maintenance, management, ownership, sale, exchange, or disposition of intangible property such as patents, trademarks, copyrights, and trade secrets. "Interest expenses and costs" include amounts deductible under Internal Revenue Code Section 163 to the extent they relate to intangible property. A "related member" is generally defined by reference to the ownership standards in IRC Section 267 or Section 1563, typically requiring at least 50 percent common ownership.

The addback is required before income is apportioned. Georgia Regulation 560-7-7-.05 (formerly designated as 560-7-3-.05) clarifies that both direct and indirect related-member costs must be added back, and taxpayers must complete Form IT-Addback to report the adjustment.

Exceptions to the related-party addback. The addback under O.C.G.A. § 48-7-28.3 may be reduced (but not below zero) to the extent the corresponding expenses are (1) received as income in an arm's length transaction by the related member, and (2) such income is allocated or apportioned to and taxed by Georgia or another state that imposes a tax on or measured by the income of the related member. For this purpose, "state" excludes states where the taxpayer and related member file a consolidated or combined return that eliminates the tax effects of the intercompany transaction. A separate exception applies if the expenses are paid to a related member domiciled in a foreign nation with a comprehensive income tax treaty with the United States, the transaction has a valid business purpose, and the amounts were determined at arm's length rates.

Other-state municipal bond interest addback. When interest income is derived from obligations of any state or political subdivision other than Georgia or its political subdivisions, the interest must be added to taxable income to the extent it was not included in gross income for federal purposes. Conversely, interest or dividends on obligations of the United States and its territories, possessions, authorities, commissions, or instrumentalities must be subtracted from taxable income to the extent such amounts are includable in gross income for federal purposes but exempt from state tax under federal law.

U.S. obligations exempt from federal tax but not state tax. Interest or dividends on obligations of any authority, commission, instrumentality, territory, or possession of the United States that are exempt from federal income tax but not from state income tax under federal law must be added to taxable income.

Depreciation adjustments. Georgia taxable income may be adjusted, at the taxpayer's election, with respect to federal depreciation deductions as provided in O.C.G.A. § 48-7-39. This provision permits certain decoupling from federal bonus depreciation and Section 179 expensing rules, though Georgia has conformed to many federal provisions over time.

Adjustments for non-Georgia losses and deductions. No portion of any deductions or losses that occurred in a year in which the taxpayer was not subject to Georgia taxation, including net operating losses, may be deducted in any tax year. When federal adjusted gross income or net income includes such deductions or losses, an adjustment deleting them must be made under rules established by the Commissioner.

Source: O.C.G.A. § 48-7-21 Source: O.C.G.A. § 48-7-28.3 Source: Ga. Comp. R. & Regs. 560-7-7-.05

Georgia uses a single-factor apportionment formula to determine the portion of a multistate corporation's income subject to Georgia tax. The formula uses only gross receipts—not property or payroll. The apportionment percentage is calculated by dividing Georgia gross receipts by total gross receipts everywhere. For sales of tangible personal property, receipts are sourced to Georgia if products are shipped or delivered to customers within the state.

Source: 2025 IT-611 Corporate Income Tax Instruction Booklet, Georgia Department of Revenue

Effective for taxable years beginning on or after January 1, 2024, Georgia sources gross receipts for corporate income tax apportionment under updated rules distinguishing tangible personal property from other receipts, as amended by HB 1023 (2023). This major change replaces the previous cost-of-performance method for services and intangibles with a market-based sourcing regime.

Tangible personal property. For corporations principally engaged in the manufacture, production, or sale of tangible personal property, gross receipts are sourced to Georgia if the property is shipped or delivered to customers within Georgia. Sales delivered from Georgia to customers outside Georgia (when negotiated or transacted from an office outside Georgia) are excluded from the Georgia numerator.

Receipts from services and intangibles (market-based sourcing, 2024+). For taxable years beginning on or after January 1, 2024, receipts from the performance of services and sales of intangible property are sourced to Georgia if the taxpayer’s market for the sale is in Georgia. The taxpayer’s market is in Georgia:

• For services: To the extent the service is delivered to a location in Georgia, including both in-person and remotely delivered services benefiting customers in Georgia.
• For intangible property: (a) Sales, rental, or licensing of intangible property are sourced to Georgia if the property is used in Georgia, and (b) for marketing or distribution of goods to customers in Georgia, if the property is used for that purpose within Georgia.

If the location of delivery, use, or benefit cannot be reasonably determined, reasonable approximation is permitted as provided in O.C.G.A. § 48-7-31(d)(2)(A.1).

Partial benefit and special rules. The law continues to allocate receipts proportionally when only part of a service is received or utilized in Georgia. Mixed receipts (from sales of both tangible personal property and other activities) are apportioned category-by-category based on their respective sourcing rules.

Authority and effective date. These amendments were enacted by 2023 Ga. Laws Act 322 (HB 1023) and codified at O.C.G.A. § 48-7-31(d)(2)(A.1), applicable to tax years beginning on or after January 1, 2024. Official state instructions and publications are pending comprehensive update, but the statutory text is controlling.

Source: O.C.G.A. § 48-7-31 Source: Ga. Comp. R. & Regs. 560-7-7-.03 Source: Georgia House Bill 1023 (2023), Act 322, enrolled text

Georgia imposes a separate corporate net worth tax on corporations in addition to the corporate income tax. This tax is calculated on the corporation's net worth — defined as the sum of issued capital stock, paid-in surplus, and earned surplus — and is assessed annually. Georgia is one of the few states that continues to impose this type of tax.

Tax amounts and exemption. For net worth years beginning on or after January 1, 2018, corporations with net worth of $100,000 or less are not subject to tax but must still file a return. The tax is imposed according to a graduated bracket schedule established in O.C.G.A. § 48-13-73:

• Over $100,000 and not exceeding $150,000: $125.00
• Over $150,000 and not exceeding $200,000: $150.00
• Over $200,000 and not exceeding $300,000: $200.00
• Over $300,000 and not exceeding $500,000: $250.00
• Over $500,000 and not exceeding $750,000: $300.00
• Over $750,000 and not exceeding $1,000,000: $500.00
• Over $1,000,000 and not exceeding $2,000,000: $750.00
• Over $2,000,000 and not exceeding $4,000,000: $1,000.00
• Over $4,000,000 and not exceeding $6,000,000: $1,250.00
• Over $6,000,000 and not exceeding $8,000,000: $1,500.00
• Over $8,000,000 and not exceeding $10,000,000: $1,750.00
• Over $10,000,000 and not exceeding $12,000,000: $2,000.00
• Over $12,000,000 and not exceeding $14,000,000: $2,500.00
• Over $14,000,000 and not exceeding $16,000,000: $3,000.00
• Over $16,000,000 and not exceeding $18,000,000: $3,500.00
• Over $18,000,000 and not exceeding $20,000,000: $4,000.00
• Over $20,000,000 and not exceeding $22,000,000: $4,500.00
• Over $22,000,000: $5,000.00

The maximum net worth tax is $5,000.

Due date and payment timing. The corporate net worth tax is due on the first day of the tax period, meaning it is an advance payment for the year ahead. C corporations must file a return and pay the tax on the 15th day of the fourth month following the beginning of the tax period. S corporations must file and pay on the 15th day of the third month following the beginning of the tax period. The net worth tax return is combined with the state corporate income tax return (Form 600 for C corporations, Form 600-S for S corporations).

Initial net worth tax. All corporations doing business in Georgia for the first time must file an initial net worth return. For C corporations with net worth years beginning on or after January 1, 2017, the initial return is due on the 15th day of the fourth month after incorporation or qualification in the state. For S corporations (and for C corporations with net worth years beginning before January 1, 2017), the initial return is due on the 15th day of the third month after incorporation or qualification. The net worth reported on the initial return is as of the date of incorporation or qualification. If the initial period from incorporation or qualification to the end of the first income tax year is less than six months, the tax due is 50 percent of the annual amount; otherwise, a full year's net worth tax is due.

Apportionment. A Georgia corporation or a domesticated foreign corporation is liable for net worth tax on 100 percent of its taxable net worth. For corporations incorporated in states other than Georgia, the net worth is apportioned using a ratio computed with property and gross receipts within Georgia divided by total property and gross receipts everywhere. For the property portion of the apportionment ratio, the "everywhere amount" is the ending balance sheet asset amount from the federal income tax return, and the "within Georgia amount" is calculated using assets owned in Georgia. Tangible and intangible assets — including cash, accounts receivable, allowance for bad debts, and accumulated depreciation — are all included in the property factor for net worth tax purposes.

Entities not subject to net worth tax. Partnerships are not subject to Georgia net worth tax. A single-member LLC is not subject to Georgia net worth tax. However, if the owner of a single-member LLC is a corporation, the corporation is subject to Georgia net worth tax if the single-member LLC does business or owns property in Georgia. A Qualified Subchapter S Subsidiary (QSSS) and its parent corporation each file separate net worth tax returns.

Public Law 86-272 does not apply. The federal protection under Public Law 86-272, which shields certain corporations from state income tax when their activities are limited to solicitation of orders for sales of tangible personal property, does not exempt corporations from Georgia's net worth tax. Net worth tax has separate nexus standards and applies even when income tax does not.

Source: O.C.G.A. § 48-13-73 Source: O.C.G.A. § 48-13-76 Source: O.C.G.A. § 48-13-77 Source: Corporate Income and Net Worth Tax, Georgia Department of Revenue Source: Net Worth Tax for Corporations - FAQ, Georgia Department of Revenue

Georgia permits certain affiliated corporations to elect to file a consolidated Georgia corporate income tax return, eliminating the prior-approval requirement that existed before 2023. This election allows members of a Georgia affiliated group to combine and report taxable income or loss on a single return while separately computing each member's apportioned income.

Eligibility: Georgia affiliated group definition. A "Georgia affiliated group" is a group of corporations in which each member: (1) is a member of an affiliated group as defined in Internal Revenue Code Section 1504 that files a consolidated federal corporate income tax return; (2) is subject to taxation under Georgia's corporate income tax provisions (O.C.G.A. Chapter 7 of Title 48), even after the application of Public Law 86-272; (3) was a member of the affiliated group for the entire taxable year, or was a member for a portion of the year if the member was subject to Georgia corporate income tax during the entire portion of the year during which it was not a member of the federal consolidated group; (4) apportions Georgia taxable income or loss separately for each corporation; (5) allocates taxable income or loss separately for each corporation; (6) computes apportionable income or loss utilizing separate apportionment factors for each corporation; and (7) combines and reports taxable income or loss on a single return for the Georgia affiliated group which includes all members of the affiliated group included on the federal consolidated corporate income tax return that are eligible to be included in the Georgia affiliated group.

Election mechanics and timing. A Georgia affiliated group may elect to file a Georgia consolidated return on an originally filed return, including extensions, if applicable. The election is made by the designated parent corporation marking the "Consolidated GA Parent Return" checkbox on Form 600. Each subsidiary member included in the consolidated return must complete Form 600 and mark the "GA Consolidated Subsidiary" checkbox and provide the federal employer identification number of the Georgia parent company. Under no circumstances may the Georgia Department of Revenue compel a taxpayer to file a Georgia consolidated return if the taxpayer has not elected to do so.

Five-year irrevocability period. The consolidated filing election is irrevocable and binding on both the Georgia affiliated group and the Department of Revenue for five taxable years. The election automatically terminates after five years. Upon automatic termination, the taxpayer may re-elect to file a Georgia consolidated return, subject to the same five-year irrevocability period.

Separate computation, combined reporting. For purposes of allocation and apportionment, each member of a Georgia affiliated group is considered a separate taxpayer. Each member separately computes its Georgia taxable income or loss using separate apportionment factors. The Georgia consolidated return then combines the separately computed post-apportioned income or loss amounts of all members. Tax credits must be calculated and claimed on a separate-company basis, with limitations based on a percentage of state income tax liability computed on a separate-company basis. Net worth tax must also be reported and paid on a separate-company basis by each member.

No combined reporting under unitary concept. Georgia law expressly provides that nothing in the consolidated return provisions shall be construed as allowing or requiring the filing of combined income tax returns under the unitary business concept. Georgia remains a separate-return state; the consolidated filing election permits combination of separately computed post-apportioned income only.

Effective date and transition. House Bill 1058, which enacted the elective consolidated filing regime, was signed into law on May 5, 2022, and applies to taxable years beginning on or after January 1, 2023. Georgia affiliated groups that received permission to file consolidated returns for tax years beginning before January 1, 2023 under the prior approval-based regime may either (1) continue to file consolidated returns under the previous criteria and remain bound by the terms of the prior grant of permission; (2) terminate their election under the previous criteria and elect to file a Georgia consolidated return under the new five-year irrevocable election; or (3) cease filing consolidated returns and file separately. The Georgia Department of Revenue promulgated Regulation 560-7-3-.13, effective for taxable years beginning on or after January 1, 2023, to implement the statutory provisions.

Source: O.C.G.A. § 48-7-21(b)(7.1) Source: Ga. Comp. R. & Regs. 560-7-3-.13 Source: Instructions to File Consolidated Returns, Georgia Department of Revenue

For tax years beginning on or after January 1, 2026, Georgia's corporate income tax rate is fixed at 4.99%.

Statutory authority—HB 463 (2026) amendment to O.C.G.A. § 48-7-20(a.1). House Bill 463, signed in 2026, amended O.C.G.A. § 48-7-20(a.1) to directly provide for a flat 4.99% tax rate for tax years beginning in 2026 and subsequent years. This statutory amendment applies regardless of the revenue-trigger and schedule established in previously enacted HB 111 (2025); HB 463 supersedes the revenue-contingent reduction mechanism by setting the rate by legislative act. The effective date provision of HB 463, as enacted, makes no reference to a conditional implementation based on the Office of Planning and Budget's trigger determination. No further executive action or confirmation is required—the rate is now set as a matter of law.

Comparison to prior law (HB 111, 2025). Under HB 111 (2025), the 2026 rate would have dropped from 5.19% to 5.09% only if certain revenue and reserve triggers were met, as confirmed by a determination from the Office of Planning and Budget (OPB) by December 1, 2025. HB 463 overrides that contingency: the 4.99% rate is the controlling statutory rate for corporate income tax beginning in 2026, and the prior trigger and schedule for the 2026 tax year are effectively moot.

Summary for the 2026 tax year. As of June 2026, the controlling statutory authority is the text of O.C.G.A. § 48-7-20(a.1) as amended by HB 463 (2026); Georgia practitioners may rely on the 4.99% rate for 2026 and need not track the OPB revenue trigger determination for this year. Future rate changes scheduled for subsequent years, if any, should be confirmed with reference to the latest statutory amendments and official DOR guidance.

Source: HB 463—Georgia Economic Growth and Tax Relief Act of 2026, signed text

Georgia requires every domestic or foreign corporation to make estimated tax payments for corporate income tax if the corporation’s Georgia income tax liability for the taxable year is reasonably expected to exceed $25,000. This threshold is prescribed in O.C.G.A. § 48-7-117—the obligation is triggered by anticipated tax liability, not taxable net income.

Estimated tax is paid in four installments across the tax year. Under O.C.G.A. § 48-7-119, the schedule for corporate estimated tax payments is:

• 25% of the estimated tax by the 15th day of the fourth month of the taxable year (April 15 for calendar-year filers)
• 25% by the 15th day of the sixth month
• 25% by the 15th day of the ninth month
• 25% by the 15th day of the twelfth month

Fiscal-year filers use these intervals based on their tax year start. If the requirement to make estimated payments arises after the start of the tax year, the installments are prorated so that the total amount due is paid in equal amounts over the remaining periods, per O.C.G.A. § 48-7-119(b)(2).

If a corporation fails to pay the required installments or underpays, Georgia imposes interest and possibly penalties. The interest rate applied is the rate established in O.C.G.A. § 48-7-81. O.C.G.A. § 48-7-120 governs the computation of the penalty for underpayment, referencing the interest calculation under § 48-7-81. Taxpayers must calculate and report underpayment of estimated tax using Form 600 UET (Underpayment of Estimated Tax by Corporations).

Any taxpayer required to make corporate estimated payments exceeding $10,000 in any given quarter must remit those payments electronically under O.C.G.A. § 48-2-32(f)(2).

Form 602-ES and the Department’s IT-611 instruction booklet provide the official worksheet, details on electronic payment procedures, and safe harbor provisions for calculating estimated payments. There is no statutory sunset or expiration—the requirements apply unless and until the General Assembly amends the relevant statutes or DOR guidance is updated.

Source: O.C.G.A. § 48-7-117 Source: O.C.G.A. § 48-7-119 Source: O.C.G.A. § 48-7-120 Source: O.C.G.A. § 48-2-32(f) Source: IT-611 Corporate Income Tax Instruction Booklet (2025)

Georgia law expressly exempts insurance companies from state corporate income tax, and provides special treatment for REITs and captive insurers.

Insurance companies: Insurance companies that pay Georgia's state insurance premium tax are exempt from the corporate income tax under O.C.G.A. § 48-7-21(a). The statute specifically states that “insurance companies which pay an annual tax to this state based upon their gross direct premiums are not liable to pay any other tax upon such premiums.” This exclusion means qualifying insurance companies are not subject to Georgia's corporate income tax on income from premiums. Preneed funeral service companies regulated under Title 33 are included in this exemption.

Captive insurance companies: Captive insurers, which are organized primarily to insure the risks of a parent or affiliated companies, are also generally exempt from Georgia corporate income tax, provided they are regulated under Georgia captive insurance statutes (O.C.G.A. Title 33, Chapter 41) and pay the appropriate captive insurance premium tax. This aligns with the treatment of traditional insurance companies, clarified under both O.C.G.A. § 48-7-21(a) and the captive insurance code reference.

Real Estate Investment Trusts (REITs): REITs are subject to Georgia corporate income tax on taxable income allocated to Georgia unless specifically exempted. Georgia conforms to federal law regarding the definition and taxation of REITs. However, income distributed by a REIT to shareholders is generally not taxed at the corporate level, but shareholders may owe tax on distributions. There is no categorical exemption for REITs in Georgia's corporate income tax law, but specialized allocation and reporting rules apply, and REIT income can create apportionment and deduction questions that must be handled according to both Georgia law and federal conformity. O.C.G.A. § 48-7-21(e) addresses REITs directly, confirming that REITs classified as corporations for federal tax purposes are subject to Georgia corporate income tax unless otherwise exempted.

Other financial entities: Banks, credit unions, and trust companies are typically taxed under the bank tax provisions of O.C.G.A. Title 48, Chapter 7, Article 2, rather than the generic corporate income tax provisions. Special allocation and exemption rules may apply for these entities as set out across both the banking code and tax statutes.

Summary:

• Insurance companies (including captive insurers properly licensed in Georgia) that pay Georgia’s premium tax are exempt from corporate income tax under O.C.G.A. § 48-7-21(a) and (b)(1).
• REITs are not categorically exempt—REITs treated as corporations federally are taxable in Georgia according to O.C.G.A. § 48-7-21(e).
• Other exempt or specially treated entities (like banks) are covered elsewhere in Georgia's code; practitioners should confirm entity and activity type before filing.

Source: O.C.G.A. § 48-7-21 Source: O.C.G.A. Title 33, Ch. 41 (Captive Insurance Companies)