Learn How Businesses In Your State Have Benefitted From Federal Pass Through Deduction

As readers are well aware, in 2017 U.S. lawmakers approved legislation that brought much needed balance to the U.S. tax code. For years, companies whose owners owed income taxes through the individual income tax system often paid higher marginal rates than their C-corporation counterparts. To offer parity, legislation signed into law that year instituted a 20 percent deduction for pass-through business (S-Corps, Partnerships, Limited Liability Companies, Sole Proprietorships) income.

While that provision was limited to the greater of 50 percent of wage income or 25 percent of wage income plus 2.5 percent of the cost of tangible depreciable property for qualifying businesses, it has saved pass through businesses millions of dollars over the last six years.

Exactly how much has it boosted smaller companies? The U.S. Chamber of Commerce (USCC) recently debuted a new data center to show the impact of the deduction on businesses, workers, and local economies. Specifically, USCC’s new interactive map quantifies the impact this policy has had in every state and congressional district. Click here to see the map. Despite this success, if members of the U.S. House of Representatives and Senate do not act, this deduction will at the end of 2025, resulting in a massive tax increase on small businesses, including many in the industrial metals industry.

That is why, in the coming months, the Metals Service Center Institute will work with the USCC and other allies to ensure this important tax provision is extended. Stay tuned to Connecting the Dots for information.