The 2025 tax reform proposal, with its plan to reduce the corporate tax rate from 20% to 15% for businesses manufacturing in the U.S., could be a major win for entrepreneurs. Some states, however, will see much bigger benefits than others.
A recent analysis by B2B marketplace DesignRush examined how these potential changes might affect businesses nationwide, calculating the potential dollar savings and percentage reductions by comparing current corporate taxes to the proposed lower rate.
For entrepreneurs looking to maximize their tax advantages, which states would deliver the most potential benefits if rates were reduced?
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Delaware
- Tax savings: $76,786
- Tax benefit: 8.44%
Delaware has long been a hotspot for business owners, and might only get better if the potential federal tax cuts go ahead. Already known for its business-friendly laws and low cost of doing business, the state remains a top choice for entrepreneurs looking for success in 2025 and beyond.
Learn More: American Opportunity Tax Credit: What Is It and Who Qualifies?
Nebraska
- Tax savings: $220,081
- Tax benefit: 7.36%
Nebraska might not have the flashy reputation of some coastal states, but it’s quickly becoming a hidden gem for business owners. Entrepreneurs could save more than $220,000 under the new tax plan. Nebraska’s combination of tax savings and a growing economy presents a compelling case for entrepreneurs looking to maximize their bottom line without the high costs typically associated with other states.
New Jersey
- Tax savings: $120,498
- Tax benefit: 5.02%
While New Jersey may not be known for low costs, potential tax cuts could change that for many businesses. Its prime location between two major economic hubs — New York City and Philadelphia — gives businesses direct access to large markets. Despite the state’s high operating costs, it also has a very high first-year business survival rate compared to most other states in the U.S., with 78.6% of new businesses making it!
Connecticut
- Tax savings: $133,562
- Tax benefit: 5.43%
Connecticut isn’t always the first choice for entrepreneurs, but the 2025 tax plan could change that. Sitting between New York City and Boston, the state stands to offer over $133,000 in tax savings, making it more competitive for businesses looking to cut their tax bills while capitalizing on nearby major markets.
Washington
- Tax savings: $129,498
- Tax benefit: 5.35%
Washington’s lack of a state income tax and tech-driven economy already makes it a top choice for many entrepreneurs, but the 2025 tax reform may sweeten the deal even more. With big names like Amazon and Microsoft, the state’s infrastructure and talent pool are already in place to support growth. Add in the potential corporate tax savings, and Washington could become a powerhouse state for entrepreneurs looking to grow without breaking the bank.
Turning Tax Breaks Into Opportunity
The 2025 tax reform proposal could make a real impact if it happens, but the potential benefits vary from state to state. Some may see only modest savings, while others could experience substantial reductions. For entrepreneurs weighing where to set up shop, expand or relocate, these states offer some of the biggest tax benefits in the country.
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This article originally appeared on GOBankingRates.com: 5 States Where Entrepreneurs Save the Most With the 2025 Tax Plan
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