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More on the Administration’s Budget

We weren’t the only ones who noticed the President’s budget for 2017 is bad for Main Street Employers.  Numerous outlets ran stories (CQ, Bloomberg, and Morningstar) focusing on the negative impact the President’s tax proposals would have on S corporations and other pass-through businesses.  As our friends from NFIB noted about the Administration’s proposal to expand the Net Investment Income Tax (NIIT) to all pass-through business owners: "It's not closing any gap," said Nick Karellas, tax counsel at the National Federation of Independent Business. "It's just blatantly a revenue grab on small-business owners who are actively participating in their businesses." ...

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By |2016-02-19T17:19:43+00:00February 19th, 2016|Uncategorized|0 Comments

Should Main Street Businesses Elect C Corp Status? No!

The idea that corporate-only tax reform isn’t so bad because Main Street businesses can elect C corporation status has been argued for years. But should Congress reduce the corporate tax rate with the expectation that pass-through businesses will just switch to C status to access the lower rates?   The answer is no.  Here are the main points: It’s the opposite of tax reform.  The corporate-only approach to tax reform is effectively “anti-tax reform.” It will return us to the pre-1986 era, when corporate tax rates were significantly lower than individual rates and tax gaming and income sheltering were rampant. It ...

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By |2015-02-04T17:33:21+00:00February 4th, 2015|Uncategorized|0 Comments

Mark to Market for Dead People

The President’s budget is out and, as we have in the past, we will start with a disclaimer.  Congress requires the President to issue a budget every year, and every year the President (regardless of party) complies with a ridiculously long and labored set of phone book-like documents outlining the budget.  And every year Congress yawns and says it’s dead on arrival.  So take our commentary below with a grain of salt, as most of the provisions in this budget are going nowhere, fast. That said, the budget includes a couple tax proposals that caught the attention of our members, ...

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By |2015-02-02T21:27:21+00:00February 2nd, 2015|Uncategorized|0 Comments

A Tale of Two Speeches

The president gave his State of the Union speech last Tuesday, while his Secretary of Treasury spoke to the Brookings Institution the following morning.  The president didn’t mention tax reform, whereas Lew devoted nearly his entire speech to building the case for action this year.  It was a head-scratching juxtaposition that still has us wondering if Treasury and the White House are on speaking terms these days. You can read the president’s speech here You can watch the Lew speech here Lew’s speech in particular is worth watching.  His focus was on the tax reform “framework” Treasury put forward three ...

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By |2015-01-26T16:49:37+00:00January 26th, 2015|Uncategorized|0 Comments

S-CORP Clips | Week of December 12

A compilation of the business tax related stories that caught our eye Hatch Tax Reform Report For weeks, there had been K Street rumors of a “secret” tax reform plan being put together by in-coming Finance Committee Chairman Orrin Hatch (R-UT).  Apparently, the “Comprehensive Tax Reform for 2015 and Beyond” report released yesterday is it, although it’s not so much a plan as an analysis of the current code and the challenges policymakers will face in reforming it.  After a quick review, it’s obvious the Finance Republican staff spent an enormous amount of time and effort putting this together and ...

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By |2014-12-12T16:22:29+00:00December 12th, 2014|Uncategorized|0 Comments