Advancement of the Small Business Community
The importance of the Small Business Community in today’s economy is indisputable, as small businesses account for approximately half of the private workforce’s employment. Congressman Hank Johnson seeks to strengthen this community by providing information and essential resources. Through various initiatives Congressman Johnson seeks to increase awareness and support for this business segment among educators, community/economic development specialists, local leaders, and community members.
Access to capital and pathways to contracting with the federal government are the most common issues for small business community leaders. In the past, Congressman Johnson has hosted a series of roundtables and "Think Tank" events that allowed for groups of business leaders to directly address governmental agency representatives with questions that are directly tailored to specific situations.
The Tax Cuts and Jobs Act of 2017
The Tax Cuts and Jobs Act of 2017 made sweeping changes to individual and business taxes. It hands large corporations a permanent tax cut and, according to the Congressional Budget Office, will cost the federal government $2.3 trillion. Yet, pass-through entities and individuals face an expiration to their provisions.
WHAT ABOUT SMALL BUSINESSES?
Small businesses face increased complexity, steep competition from large companies, and a 20% deduction on pass-through business income that does not apply equally to all. And, unlike the permanent tax cut for large corporations, the 20 percent deduction expires in 2025.
WHAT’S THE PROBLEM?
• The 20% deduction on qualified business income for pass-through entities picks winners and losers. It penalizes small business owners’ based on their chosen professions by imposing greater limitations on providers of “specialized services.”
• It also raises more questions and creates confusion with complex formulas and undefined terms. Unfortunately, regulations still haven’t been released.
• On average, corporate tax breaks give corporations a larger benefit and put small firms at a competitive disadvantage as they bear the cost of the law.
• The new tax law may not translate into significant savings for small businesses, many of which will incur the additional cost of accountants and tax lawyers in order to navigate and satisfy their tax obligations.