A corporation with no office or staff in New York is subject to the New York corporation franchise tax once its New York receipts reach $1.283 million in a tax year (the threshold for 2024 to 2026; the amount for 2027 to 2029 had not been published as of October 2026). Most pay 6.5% of the income apportioned to New York, or a fixed dollar minimum based on receipts if that is higher.
New York at a glance
- Business tax: Corporation franchise tax
- Bright-line economic nexus test: $1,283,000 in sales (2026)
- P.L. 86-272 protection for sellers of goods: Can apply
- Notes: Indexed; this is the threshold for 2024 to 2026 (the 2027 amount was not yet published in October 2026). New York also applies a narrower reading of P.L. 86-272 to internet activity.
Checked against state guidance in October 2026. Compare every state
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See where your company may owe state income, franchise or gross receipts tax, based on each state’s bright-line test, your physical presence and what you sell.
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Standards last reviewed September 2026. Many states have no bright-line test and decide nexus from your activities; local taxes, pass-through entity rules and withholding for remote employees are not covered. Results are estimates for general information only, not legal, tax or financial advice. Confirm them with your own CPA, tax adviser or attorney before making decisions. Using this tool does not create a client relationship with Catching Numbers Inc.
What is New York’s economic nexus threshold for corporate tax?
A corporation “derives receipts” from New York, and has nexus, once its receipts from New York customers reach $1.283 million in the tax year. New York reviews the amount every three years. In a combined group, a member with at least $10,000 of New York receipts also has nexus if the group together passes the threshold.
Does selling SaaS or services into New York count?
Yes. New York assigns receipts from digital products, software access and most services to where the customer is, so SaaS revenue from New York customers counts toward the $1.283 million test. P.L. 86-272 protects only sellers of physical goods, so it does not shield SaaS, services or digital products.
I only sell physical products. Am I protected?
Possibly, under P.L. 86-272, if your only activity in New York is asking for orders that are approved and shipped from outside the state. New York’s regulations read that protection narrowly for internet activity: interacting with New York customers through your website beyond taking orders, for example offering post-sale support online, can take you outside it.
How much is New York corporation franchise tax?
Most corporations pay 6.5% of their business income apportioned to New York, rising to 7.25% if that income is over $5 million. If it is higher, you pay the fixed dollar minimum instead, which depends on New York receipts and ranges from $25 to $200,000. New York City has its own business corporation tax with separate rules.
What about S corporations and LLCs?
An S corporation is taxed as an S corporation in New York only if it makes a separate New York S election; it then generally pays the fixed dollar minimum. LLCs taxed as partnerships don’t pay the franchise tax, but they may owe an annual filing fee if they have New York source income.
Do I also need to collect New York sales tax?
That is a separate test: more than $500,000 of goods and more than 100 sales delivered into New York. SaaS is taxable for sales tax in New York. See our New York sales tax nexus guide.
Frequently asked questions
When is the New York corporation franchise tax return due?
For calendar-year corporations, Form CT-3 is due April 15, the 15th day of the fourth month after the tax year ends.
Does a remote employee in New York create nexus?
Yes. An employee working in New York gives your company a physical presence there, whatever your receipts, and you will need to register as a New York employer and withhold New York income tax.
Is the $1.283 million threshold per company or per group?
Per corporation, with a group rule: in a combined group, each member with at least $10,000 of New York receipts has nexus if the members’ New York receipts together reach the threshold.
Does New York City have the same threshold?
New York City has its own business corporation tax with its own nexus rules and return, separate from the state franchise tax. Check it separately if you have customers or activity in the city.
Selling into New York from another state?
We keep your books with revenue tracked by state every month, so you and your tax CPA can see where you have nexus and have clean numbers ready for each state return.
General information for remote sellers, checked against state guidance in October 2026. New York rules change and depend on your facts, so confirm your situation with the state or a tax advisor before registering or filing. We don’t prepare sales or income tax returns.