SAF, along with several other groups which are members of the Small Business Legislative Council (SBLC), submitted a statement for the record to the U.S. Senate Small Business & Entrepreneurship Committee urging Congress to improve tax reform for pass through entities and avoid proposals that would cause significant harm to the small business retirement plan system.
The letter requested that the Section 199A deduction for pass through entities be made permanent and that more businesses be permitted to take advantage of the 199A deduction.
Currently, Section 199A excludes a large number of pass through entities from the deduction and adds complexity to the tax code, forcing small businesses to struggle with new and extremely complicated rules.
In addition, the letter emphasized the importance of making the increased estate and gift tax permanent while maintaining the step-up in basis at death for the successful small businesses.
Noting that several portions of S. 2526, the Retirement Enhancement and Savings Act of 2018, are beneficial, the letter noted strong opposition to an element of the bill that “could provide a significant deterrent to individuals continuing to save in a small business retirement plan and result in the freezing or termination of many small business plans (by small business owners who have saved “enough” in the plan).”
2526 has not yet been considered by the Senate and its future is uncertain given the recent midterm elections.
Shawn McBurney is the Senior Director of Government Relations for the Society of American Florists