Later today, I’ll be meeting with a tax preparer to finalize my income taxes for last year.
Although I don’t mind paying federal income taxes because they pay for government services people need, it upsets me that I pay more in income taxes than some corporations.
At least 88 of the largest corporations in America paid no federal corporate income taxes in their most recent fiscal year despite enjoying substantial pretax profits in the United States, according to the Institute on Taxation and Economy Policy.
While the biggest U.S. corporations have avoided taxes in this way for decades, it appears that corporate tax avoidance has increased in the most recent year, the institute said in a statement. This is, at least in part, due to two separate packages of corporate tax cuts pushed through by the Trump administration: last year’s “One Big Beautiful Bill Act” and the 2017 Tax Cuts and Jobs Act.
The institute said these tax-avoiding corporations represent a variety of industries and together had more than $105 billion in U.S. pretax income in 2025. The federal income tax rate for corporate profits is 21 percent, which means these 88 corporations would have paid a total of $22.1 billion for the year had they paid that rate on their 2025 income. Instead, they received $4.7 billion in tax rebates.
This means the total federal corporate income tax breaks enjoyed by these companies comes to $26.7 billion when measured against the 21 percent statutory rate, according to the institute. Measured against the 35 percent corporate income tax rate that was in effect before the two corporate tax cuts pushed through by Republicans and President Trump since 2017, these companies cut their income taxes by $41 billion in 2025 alone.
Which companies paid zero federal income tax in 2025?
The companies avoiding all federal income tax in 2025 represent a broad cross-section of the U.S. economy, from manufacturing to services:
- The automaker Tesla reported zero federal income tax paid on almost $5.7 billion of U.S. income in 2025.
- Southwest Airlines avoided all federal income tax on $561 million of income last year; its competitor United Airlines achieved the same zero-tax result on almost $4.3 billion of U.S. income.
- The entertainment company Live Nation Entertainment paid zero federal income tax on $98 million of U.S. income.
- Yum! Brands, the parent company of the fast-food chains KFC, Taco Bell, and Pizza Hut, paid no federal income tax on more than $1 billion of U.S. pretax profits last year.
- Three tech companies that specialize in digital payments – PayPal, Toast, and Block – paid zero federal income tax on $3.2 billion of U.S. income.
Final thoughts
I hope that someday, this will change. Rich corporations need to pay their fair share. However, if previous patterns continue, it’s unlikely we won’t see a change due to the “tax doom loop,” according to an article in The New York Times.
It goes like this: Republicans pass huge tax cuts that are, at first, only temporary. By the time the tax cuts are set to end, Americans have become used to owing less to the government. Hesitant to raise taxes, Democrats join with Republicans to continue many of the cuts indefinitely.
Photo: Mr.choppers
