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HomeAg NewsGrassley Hits Senate Small Business Pass-Thru Tax Rider

Grassley Hits Senate Small Business Pass-Thru Tax Rider

Senior Senate Finance Republican Chuck Grassley says a Senate-adopted amendment to the Inflation Reduction Act the House is expected to pass today (Friday), could slam small ‘pass-through’ businesses like family farms that report income as individuals.

The Senate rider cannibalized a 2017 ‘pay-for’ to lower the tax rate for small so-called ‘pass-through’ businesses and used it instead to soften the blow from a minimum tax on big firms in the Inflation Reduction Ac.

“We feel like it was very hastily drafted, maybe not well drafted, but I think we’ve got reason to think it’s going to be very harmful to the ‘pass-through’ for the family farmer, and other small businesses.”

Grassley says if taxes go back up on these businesses when the current deduction expires in 2026, that will defy promises made about the Inflation Reduction Act.

“And this refutes, or is completely in opposition to this administration’s claim that it’s not going to be taxing people under 400,000.”

As the small business ‘pass-through’ rate rises back to the corporate rate, reversing the 2017 deduction.

“From 35-percent to 21-percent for ‘C’ corporations, and it didn’t bring complete balance, but it brought more balance to it, than we would have had otherwise, and this could be obliterating that.”

Democrats refrained in their bill from trying to directly reverse the 2017 Trump tax cuts, until the Senate amendment fight over how to pay for limiting a wider hit from the corporate minimum tax.

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