payroll taxes - The S Corporation Association

Senator Clinton’s Tax Policies – Bad for S Corporations

Recently, we reviewed Senator Obama’s tax policies and how they might impact S corporations should he become President. What about Senator Clinton? If she becomes President, how would her tax policies impact small and closely-held businesses?

In general, Senator Clinton has opposed the rate relief and other tax reductions enacted over the past eight years. As she told one audience:

I want to restore the tax rates we had in the ’90s. That means raising taxes on corporations and wealthy individuals. I want to keep the middle-class tax cuts, and I want to start making changes that will save us money, save …

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admin2019-02-06T18:43:57+00:00March 31, 2008|

Chairman Rangel Proposes Payroll Tax Increase on Small and Family-Owned Businesses

When Congress created the S corporation in 1958, the IRS ruled that only S corporation shareholders who are active in their business should be subject to payroll taxes, and then only on amounts received for their labor.

Fast forward fifty years. While the payroll tax has grown dramatically, the application of payroll taxes has always applied to labor income only – not capital income.

Last week, all this changed. House Ways and Means Committee Chairman Charlie Rangel [D-NY] introduced legislation that turns 50 years of tax policy on its head.

The bill, the Tax Reduction and Reform Act of 2007, would lower …

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admin2019-02-06T18:43:59+00:00October 29, 2007|

More Details on the Rangel Tax Bill

At a members briefing this evening, Ways and Means Chairman Charlie Rangel outlined his “Mother of All Tax Bills” to the Committee membership. In essence, he outlined three separate bills that he will introduce in one package:

– A bill to repeal the individual AMT and provide tax benefits for low income families; A bill to extend for one year a group of tax provisions scheduled to expire at the end of 2007, including the temporary AMT “patch”; and
– A bill to cut the corporate tax rate down to 30.5 percent.

As S-Corp readers know, the tax benefits from these three …

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admin2019-02-06T18:44:36+00:00October 24, 2007|

Congress Returns

Congress came back from its August break this week and is picking up right where it left off, struggling with the question of what to do with the Alternative Minimum Tax and examining how to appropriately tax the carried interest earned by hedge fund managers and other general partners.

These questions are connected, obviously, in that addressing the AMT will be very expensive while raising the tax rates on carried interest would presumably raise lots of revenue. That’s one reason why both the Ways and Means and …

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admin2019-02-06T18:44:37+00:00September 7, 2007|

AMT Plan Imminent — House & Senate Moving in Different Directions

The Ways & Means held a hearing yesterday on the Alternative Minimum Tax. While there is broad consensus in the tax world that the AMT is broken, there is little common ground on exactly how to go about fixing it. To date, Congress and the Administration have confined their efforts to temporary, one or two year “patches” that raised the AMT exemption just enough to limit the growth of AMT taxpayers. The current higher exemption runs through 2006, however, so Congress needs to act in the next …

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admin2019-02-06T18:46:05+00:00March 8, 2007|