effective rates - The S Corporation Association

Camp Draft Released

Ways and Means Chairman Dave Camp (R-MI) released his long-awaited tax plan yesterday. The Chairman has worked hard to put out a plan that addresses the biggest challenges faced by the tax code, and he should be applauded for keeping this effort alive.

From day one, Camp has been our lead in promoting comprehensive reform that addresses both the individual and the corporate tax codes. Such an approach was needed if pass-through businesses like S corporations and LLCs were going to be treated in an even handed manner. This priority of leveling the playing field was embraced by our Main …

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admin2019-02-01T20:05:24+00:00February 27, 2014|

CBO Gets Effective Rate Wrong

February 6, 2014

The tax reform effort may face significant headwinds, but the debate over who pays what continues, with the business community doing a good job of articulating just how much they pay in taxes and entities like the Congressional Budget Office, well, not.

Embedded in yesterday’s economic update is a section entitled “Corporate Income Taxes” that includes a chart showing the effective tax rate of the domestic profits of C corporations declining over time. The effective corporate tax rate was in the 30s during the 1970s, in the 20s during the 1980s and 1990s, but now is down in …

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admin2019-02-01T20:05:25+00:00February 24, 2014|

Tax Reform Rehash

The release of Finance Committee tax reform discussion drafts on cost recovery and international tax have laid bare a reality that’s been hiding just below the surface for two years now the visions for reform embraced by the key House and Senate tax writing committees are dramatically different and move in opposite directions.

The international drafts are a good example. The Ways and Means draft would move the tax treatment of overseas income towards a territorial system, while the Baucus draft would move towards a more pure worldwide system by largely eliminating deferral. Here’s how the Tax Foundation described it:

Of …

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admin2019-02-01T20:19:33+00:00December 12, 2013|

The Importance of Pass Throughs

Put on your “must read” list a new paper from our friends at the Tax Foundation highlighting the importance of pass-through businesses to jobs and employment. It’s the best written and most comprehensive summary of the issue we’ve seen to date. Here’s how it starts:

Support for lowering the corporate tax rate – now the highest in the OECD – has been expressed by both Democrats and Republicans in order to improve the competitiveness of American businesses. However, they differ in their plans for the individual tax code. While Republicans have proposed lowering the top individual rate from 39.6 percent to …

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admin2019-02-01T20:08:23+00:00September 10, 2013|

S-Corp Study in the News

Since its release yesterday, the effective tax rate study put out by S-Corp and the National Federation for Independent Business has been getting traction both on the Hill and in the media. The study shows that S Corporations pay the highest effective rates of any business type, and its results come at a critical time for tax reform.

Following the release, the Ways and Means Committee issued a statement:

The study adds to the growing momentum for tax reform expressed by Democrats and Republicans alike who have called for fixing the broken tax code for job creators of all sizes. …

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admin2019-02-01T20:08:23+00:00August 8, 2013|