Good news! The 2017 version of the “S Corporation Modernization Act” has been introduced the House and the Senate. Led by Senators Thune (R-SD) and Cardin (D-MD) and Representatives Reichert (R-WA) and Kind (D-WI), the bill calls for needed updates to the rules governing S corporations, some of which date back over 50 years!
The Wall Street Journal featured S-Corp Board member Clarene Law last week in a story focused on the new tax rates for pass through businesses in the House tax reform plan. As the story notes:
Clarene Law said a lower tax rate on pass-throughs would free up capital to add rooms to her hotels in Jackson, Wyo. or buy new air conditioners and washing machines.
“25% if it’s pure, not all cobbled up with a bunch of surtaxes, it would be a great benefit,” said Ms. Law, chief executive officer of Elk Country Motels Inc. Her businesses own more than 400 …
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The Tax Foundation published its annual piece on pass through businesses this week, and as usual, there’s lots of great material in there. To begin, the Foundation updates its numbers on pass through employment and marginal tax rates. As in past years, pass through businesses employ the majority of private sector workers even though they face marginal tax rates that often exceed 50 percent! Talk about shooting yourself in the foot, economically speaking.
Robert Samuelson at the Washington Post noticed. In an op-ed last week, he highlighted some of the key metrics found in the Foundation’s report:
“Here are some …
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Last month’s elections so dramatically changed the outlook for tax policy in 2017 that we’re still trying to catch up. The outlook for the proposed 2704 regulations in particular has done an about-face, going from appearing almost inevitable to having the Chairman of the Ways and Means Committee, along with others, targeting them for elimination quickly next year.
But they are not dead yet, and the regulatory process moves on. Today, the IRS hosted its public hearing on the proposed rules, and the family business community arrived in force—S-CORP in particular. We submitted our formal comments back on October 17th, …
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Do family businesses still need to worry about the 2704 valuation rules? These rules have consumed the attention and resources of family businesses nationwide since they were first proposed back in August. While we have been assured there is no plan to finalize the rules before the end of the current administration, many families are still wary of their potential impact if they were allowed to take effect. So, will the rules move forward in 2017? Or will the new tax leadership taking control ensure they go away?
Ways & Means Chairman Kevin Brady (R-TX) helped provide clarity on that question …
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