U.S. Rep. Lloyd Smucker (R-PA) introduced legislation that would keep Section 199A of the Internal Revenue Code from expiring in 2025.
Section 199A allows for a 20 percent pass-through income deduction for certain small businesses from qualified REIT dividends and income from publicly traded partnerships.
“Providing permanency to this critical pro-growth tax policy will ensure small businesses continue to have tax parity with corporations and will strengthen main streets across the nation,” Smucker said.
More than 160 organizations support the bill.
“The 20 percent Small Business Deduction is set to expire in 2025, and without it, small businesses will have to limit their plans to grow, invest, and hire,” NFIB President Brad Close said. “By making the deduction permanent, small business owners will have the tax certainty they need to make business decisions about their future.”
“Small and medium manufacturers, often organized as pass-through entities, are the backbone of the American supply chain,” Chris Netram, National Association of Manufacturers managing vice president of policy, said. “Section 199A allows pass-throughs to deduct 20 percent of their qualified business income, enhancing the ability of small firms to reinvest in their businesses and their workers and increasing the resilience of manufacturers in America. Unfortunately, Section 199A is scheduled to be eliminated at the end of 2025.”