The National Federation of Independent Businesses (NFIB) is urging small business owners to pressure President Joe Biden and Congress.
Last year, the Biden administration and Congress proposed a series of new tax increases and mandates. The NFIB says the increases and mandates are “unfairly masked” as necessary to “close a loophole” and “fund Medicare.” None of these things are true. according to the NFIB. What’s true, the NFIB says, is that small businesses are already being impacted by things like inflation, the tight labor market, and supply chain problems. Small businesses don’t need any other tax.
The 3.8% surcharge for small businesses
A version of the 3.8% small business allowance has been around since 2013, when it was included as part of the Affordable Care Act. However, it is not imposed on corporate income. It was imposed on interest, dividends, annuities, royalties, rents and passive income.
The NFIB says Congress is ready to extend the small business surcharge to business income earned by small businesses. Continuing with small businesses includes S corps, LLCs, sole proprietorships, and partnerships.
The surcharge is included as part of the Build Back Better Act and Congress has not yet voted on it.
There are guidelines for business income. The 3.8% surcharge would be levied on business income in excess of $400,000 ($500,000 for aggregate returns). The surcharge of 3.8% would also be levied on matters held in trusts that have earned more than $13,000.
Other proposes increases and mandates
In 2021, the Biden administration and Congress proposed a series of new tax increases and mandates, including the following. The information below has been compiled by the NFIB:Limiting the deduction for small businesses (IRS Section 199A) Increasing the corporate income tax rate to 28% with no lower rates for small businesses Increasing the top income tax rate for individual and family businesses from 37% to 39.6% Eliminating incremental Raising Top Tax Rates on Capital Gains Taxes Taxing Unrealized Gains Over $100 Million With Concerns That The Threshold Would Be Lowered Quickly Over Time Elements of the Protecting the Right to Organization (PRO) Act enact. family and medical paid leave program
What can you do?
Thanks to the work of the NFIB and the advocacy of small business owners, several harmful proposals were eliminated from the House version of the Build Back Better Act. However, this policy could still be reflected in future legislation, and as the US Senate considers the Build Back Better Act.
What can you do?
You can contact your elected representatives and urge them not to pass legislation that further influences and challenges small business owners.
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This post NFIB Calls Small Business Surcharge a Direct Attack on Main Street was original published at “https://smallbiztrends.com/2022/07/small-business-surtax.html”