A recent Twitter thread caught our eye. S-Corp typically avoids these Twitter feuds, but this is an important topic that deserves some clarity. Here’s the thread in question:

So Pomerleau thinks 199A is unnecessary while S-Corp and our Main Street Employers Coalition have long maintained that 199A is necessary for rate parity. Who is right?

Effective Statutory Tax Rates

Looking at Pomerleau’s paper, he uses three measures to examine the parity question – Effective Statutory Rates, Marginal Effective Tax Rates, and Average Marginal Effective Tax Rates.  For the first, here’s his table:

…

(Read More)

Tax Notes ran a letter to the editor this week penned by S-Corp President Brian Reardon. It responds to a recent critique of the Section 199A deduction and serves as a useful “cheat sheet” in rebutting the various claims we’ve seen over the years.

The first is that extending 199A will add to the deficit. As the piece points out:

The deduction was packaged with numerous tax hikes — the state and local tax cap, the excess loss limitation, the interest deduction cap, and others — that target upper-income business owners. Many of these pay-fors stay in the tax code …

(Read More)