Income Inequality and S Corporations
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S Corporation Association President Brian Reardon testified this week – via Zoom – before the Michigan House of Representatives’ Tax Policy Committee. The subject of the hearing was H.B. 4288, which would permit electing pass-through businesses to pay their state and local tax (SALT) at the entity level, thus enabling them to fully deduct these expenses on their federal returns. Click the screenshot below for a video of Brian’s testimony:
Brian kicked off his testimony with a presentation (available here) on how Michigan taxpayers would benefit from enactment of H.B. 4288. …
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More than 80 business groups signed on to support legislation making permanent the 20-percent pass-through deduction (Section 199A). The bill was sponsored by Steve Daines (R-MT) in the Senate and Jason Smith (R-MO) and Henry Cuellar (D-TX) in the House.
The 199A deduction was a key part of the Tax Cuts and Jobs Act, enacted in 2017. The deduction was designed to balance out the tax treatment of pass-through businesses with the lower, 21-percent tax rate paid by C corporations. As our EY study from the time made clear, the deduction works to help level the playing field, but only for those …
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Tori Gorman, Policy Director for The Concord Coalition, joins our podcast to discuss the intricacies of the budget reconciliation process, its role in moving the latest Covid relief package, whether policies like a $15 minimum wage can be advanced through reconciliation, and what the upcoming fights over process mean for the tax outlook in 2021.
Our latest “Talking Taxes in a Truck” podcast was recorded on February 22, 2021, and runs 28 minutes long.
Editor’s Note: At 1:15, Brian incorrectly describes Tori’s past role at the Senate Budget Committee as “Counsel.” Her title on the committee was “Parliamentarian.”
With impeachment over, congressional Democrats are turning their attention to their $1.9 trillion coronavirus relief bill. House committees spent prior weeks marking up pieces of the bill, which will be consolidated into a single “reconciliation” package by the Budget Committee today and then considered by the full House later this week.
For the Main Street business community, the process here is as important as the policy. The congressional majority chose to use reconciliation to move their COVID relief package, which raises several issues worth highlighting.
Senate Rules Under Pressure
The primary benefit of using reconciliation in the Senate is the ability to pass …
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