At Least 55 U.S. Corporations Paid Zero In Federal Income Taxes In 2020
Due to the tax cuts and Jobs Act of 2017 alongside the tax benefits of the Care Act, passed in the spring of 2020, several biggest U.S. corporations evaded paying billions of federal corporate taxes in the latest fiscal year.
At least 55 business giants paid zero federal income taxes in the decade-long trend of corporate tax avoidance, according to the Institute of Taxation and Economic Policy. As the results, the annual financial records show that the companies collectively his about $40.5 billion in U.S. pretax income in 2020 alone.
The 55 corporations would have paid a collective total of $8.5 billion for the year had they paid that rate on their 2020 income. Instead, they received $3.5 billion in tax rebates.
Here is a data directly from the income tax noted from their reports.
The companies avoiding income taxes in 2020 represent very different sectors of the U.S. economy:
Food conglomerate Archer Daniels Midland enjoyed $438 million of U.S. pretax income last year and received a federal tax rebate of $164 million.
The delivery giant FedEx zeroed out its federal income tax on $1.2 billion of U.S. pretax income in 2020 and received a rebate of $230 million.
The shoe manufacturer Nike didn’t pay a dime of federal income tax on almost $2.9 billion of U.S. pretax income last year, instead enjoying a $109 million tax rebate.
The cable TV provider Dish Network paid no federal income taxes on $2.5 billion of U.S. income in 2020.
The software company Salesforce avoided all federal income taxes on $2.6 billion of U.S. income.
The U.S. income, current federal income tax and effective tax rates in 2020 for all 55 of the zero-tax companies are shown in the following table.
However, it was reported that these 55 companies enjoyed even more tax benefits from the carryback provisions. At the beginning of 2020, the government designed the CARES Act in order to help people and business to stay afloat during the pandemic. Some of those 55 companies later acknowledged CARES Act benefits apart from separating the effect of the carryback changes. Other companies were not so “significant” to disclose Cares Acts benefits.