Do co-ops pay taxes?
Cooperatives pay taxes similar to other business entities. In fact, cooperatives generally pay under the same rules and regulations and at the same rates as other business organizations. Cooperatives pay property, sales, excise, school and other taxes, and comply with the same regulatory burdens as other businesses. For federal income tax purposes, cooperatives are treated similarly to the three basic types of private business organizations currently used in the United States: individually owned businesses, partnerships and corporations. In the case of individually owned businesses and partnerships, profits and losses are passed through and taxed at the individual owner level. Cooperatives generally are taxed in the same manner – the net margins from member operations are passed through to the member-owners of the cooperative business and are taxed at the owner level. Some cooperatives do business with nonmembers; when they do, they pay taxes on the taxable income from nonmember busine
