Rate Parity - The S Corporation Association

Pass Thru Rates & Enforcement

As Congress returns to tackle tax reform, one area of consensus continues to be ensuring that Main Street is treated fairly by establishing a new, low top rate on pass through businesses. But separating business and individual rates brings its own challenges. As BNA reported last week:

Economists and tax accountants note that taxing pass through income at rates distinct from the individual income scale would open up incentives for taxpayers to route their income through the lowest rate path. Treasury Secretary Steven Mnuchin recently said tax reform legislation would include rules to prevent people from gaming the tax rate …

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admin2019-01-31T22:48:48+00:00June 6, 2017|

Ways & Means Takes on Tax Reform

The House Ways and Means Committee began its focus on tax reform yesterday with a hearing on economic growth. The hearing, entitled “How Tax Reform Will Grow Our Economy and Create Jobs” featured four company representatives and one hedge fund manager invited, oddly enough, by the Minority.

One of the company witnesses, Zach Mottl, is the Chief Alignment Officer for Atlas Tool Works, a multi-generation family business located outside of Chicago. Operating in an industry with large, multinational competitors, Zach made clear the current rate structure is tilted against smaller companies like theirs that lack the international presence to …

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admin2021-08-16T14:02:35+00:00May 19, 2017|

Trump To Weigh In On Taxes

So what do we know about the Administration’s tax announcement scheduled for tomorrow? First, we expect the announcement will be limited to principles and a couple key proposals – not a full blown tax reform plan.

Second, the emphasis appears to be on cutting tax rates. We expect something similar to the Trump campaign’s proposal setting the top rates at 33 percent for families and 15 percent for businesses.

Finally, there is likely to be a call for territorial tax treatment coupled with some commentary on the need for leveling the international tax playing field. We could see the term “reciprocal taxes” …

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admin2019-01-31T22:50:18+00:00April 25, 2017|

Reichert, Buchanan Present S Corp Tax Relief to Ways and Means

As our members know, S-Corp wears two hats when it comes to advocacy – one is defensive where we protect S corporations from bad tax policy. The other is proactive and seeks to improve the S corp rules.

Both hats were on display this week before the House Ways & Means Committee. First, Rep. Dave Reichert (R-WA) discussed his S Corporation Modernization Act which makes a number of improvements to the S corporation rules, including opening the door to foreign investment into S corporations. As Rep. Reichert told the Committee:

Click on …

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admin2019-02-01T19:56:24+00:00May 13, 2016|

Rate Parity Bill Introduced!

For five years, the S Corporation Association and its allies have asked tax writers to pursue business tax reform that taxes all business income just once and at the same, reasonable top rates. That’s the correct way to tax business income and more than 100 trade groups, including the largest trade groups in the country representing millions of employers, have signed on to this premise.

And for five years, we’ve watched as the tax code moved in exactly the opposite direction.

Instead of preserving rate parity, the combination of the Fiscal Cliff and the implementation of the Affordable Care Act resulted in …

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admin2019-02-01T19:56:25+00:00April 29, 2016|