Taxes & Fees

Property Tax

Rate per $100 value of assessment
Town: $0.74
County: $2.53

Rate of Assessment

Certification Process

To achieve Three-Star certification, communities must complete a formal review and evaluation process conducted by a team of economic and community development (ECD) professionals.

Recertification Process

Three-Star Communities are recertified annually to ensure each has maintained the basic program requirements and added new elements to expand or enhance their development plans.

Corporate Income or Excise Tax

Tennessee levies an excise tax of 6% on net earning of corporations, foreign or domestic, from business conducted in the state, or on state apportionment of total earnings of interstate corporations. All taxes are deductible in determining the state excise tax base, except excise taxes and income taxes paid to the federal government or a foreign government.

Franchise Tax

The franchise tax applies to foreign and domestic corporations doing business in Tennessee. The rate is based on the issued and outstanding stock, surplus and undivided profits apportioned to Tennessee at the end of the fiscal year. The franchise tax rate is $.25 per $100 with a minimum of $10.

Gasoline Tax

The state levies a gasoline tax on gasoline at the rate of $.20 per gallon.

Sales & Use Tax

The sales tax applies to any person or company who manufactures, distributes or retails tangible personal property within the state. The sales tax law places the legal incidence of the tax upon the seller. The Tennessee state sales tax rate is 7%, and the local option sales tax is 2.75%.

Property Tax

Tennessee does not impose a state property tax. The property tax is levied on real and personal property by county and municipal governments. All owners of property are liable for property taxes.

Utility Gross Receipts Tax

The utility gross receipts tax of 3% is based in intrastate gross receipts. Gross receipts taxes are paid only by bottlers, utilities, gas, water, electric power and light companies, telephone and telegraph companies, and sewage companies.

Personal Income Tax

The state of Tennessee does not tax earned income. A 6% tax is levied on dividends and bond interest received by individuals or other entities, including partnerships and trust.

Unemployment Insurance Tax

Unemployment compensation taxes are collected by both federal and state governments, with Tennessee’s portion of the tax serving as a credit against a portion of the federal taxes owed. The rates for employers vary. For new employers, the rate is 2.7% of the first $7,000 of employee pay.

Initial Corporate Organization Fees

Domestic for-profit or nonprofit corporation: $100.00
Domestic limited partnerships: $50.00
Domestic limited liability company: $50.00/member*
Foreign for-profit or nonprofit corporation: $600.00
Foreign limited partnerships: $300.00
Foreign limited liability company: $ 50.00/member

*$50.00 per member on the date of filing, with a minimum fee of $300 and a maximum of $3,000.
Corporations (for-profit and nonprofit) and limited liability companies are required to file an annual report with the Tennessee secretary of state.