Regional News for small business owners:

Small Business Deductions may be going away next year. 

Making the Small Business Deduction permanent before it expires at the end of 2025 is NFIB’s top priority NFIB member Michael Ervin testified before the U.S. House Ways and Means Committee hearing on April 11 about the importance of making the Small Business Deduction permanent.

“Currently, we employ over a dozen people in our community,” said Michael. “Additionally, I coach and train many other Main Street business owners throughout my region… [the Small Business Deduction] has allowed me to deduct up to 20% of my business income, which has let me invest in my business, my employees, and my community. I have been able to increase my employees’ hourly wages, invest in equipment, grow from a single location to three locations, create a mobile location, and sell my Main Street roasted coffee internationally.“

Michael is the owner of Coal River Coffee Company in Saint Albans, West Virginia. In his testimony, he noted how the 2025 deadline is already impacting his future business decisions. “While the end of 2025 sounds far away, I will soon have to make long-term business decisions based on future expectations,” explained Michael. “The lack of certainty surrounding my tax burden certainly makes long-term planning more complicated. I want to continue to grow my business, add locations, and increase the pay of my hard-working employees, but that becomes more difficult when I have less money to reinvest in my business.”

The Small Business Deduction allows small businesses organized as pass-throughs (S-corporations, sole proprietorships, or partnerships) the ability to deduct up to 20% of qualified business income and is scheduled to expire at the end of 2025. The bi-partisan Main Street Tax Certainty Act would make the Small Business Deduction permanent.

“In two years, if my taxes go up, the corporate rate will remain 21%,” noted Michael. “Tim Hortons will be paying a 21% federal rate and a 6.5% state corporate rate for a total combined rate of 27.5%, while my total combined rate will be closer to 45%… I’m not asking for special treatment, but I am asking that small businesses get treated equally with big businesses and not be placed at a competitive disadvantage by the tax code.”

More information about the Small Business Deduction is available at smallbusinessdeduction.com. Take Action: Join fellow small businesses across the country by adding your name to our petition to prevent a massive tax increase at the end of 2025. NFIB Report Link Here

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