- The endemic rot in government run health care
- Senate Unanimously Passes Coburn PAYGO Transparency Amendment (CFA Site »)
- The Debt Panel's 800-lb. Gorilla: Why Andy Stern Stands Out
- The Left Agree: Obamacare Ushers In Their Radical Ideological Agenda
- We Ought Focus On Cutting Taxes & Spending, Not Deficits
- The Debt Panel's 800-lb. Gorilla (AWF Site »)
-
Does the Obamacare Investment Surtax
Apply to Capital Gains? - ATR Urges Opposition to Sen. Isakson Pension Bailout
- Taxpayers to Legislators: Clean Virginia Budget of Taxes
- ATR Supports the Georgia JOBS Act
Tuesday, March 9, 2010
- ATR Urges Utah Governor Herbert to Veto Tax Increase
- More on the VAT
- Public Sector Jobs
- How 550,000 jobs were destroyed by the minimum wage hike
- How Obamacare Will Hurt Poor Women & Children Most
- Federal Workers Make $11,000 More Than Private Sector Workers, and There’s More of Them (AWF Site »)
- Really?!? If This is Transparency, Beware of Opacity (CFA Site »)
Monday, March 8, 2010
- Legislation Introduced to Put Ronald Reagan on the $50 Bill
- Pledge Signer Wins Illinois Republican Gubernatorial Primary
- New Jersey Transparency Legislation Broadened to Encompass Localities (CFA Site »)
- "Net Neutrality" To Kill Jobs
- Illinois Medicaid Transparency Bill Advances (CFA Site »)
- NY Supreme Court Votes to Evict Residents and Close Businesses (PRA Site »)
- California US Senate Candidates Square Off in First Debate
Friday, March 5, 2010
- Small Step in Right Direction in NH Senate (CFA Site »)
- ATR and CFA Support the Spending Limit Amendment
- Utah Representative Breaks Tax Pledge
- AWF Will Rate Vote on House Jobs Bill (AWF Site »)
- Energy Tax Hike Series: Use it or Lose it Tax
Thursday, March 4, 2010
- The reliability of spending "estimates"
- Utah State Senator Tries to Sweeten Tax Hike with Pork
- Obama Administration Makes Attempt to Seize Millions of Acres Across America (PRA Site »)
- More "Stimulus" Boondoggles - Social Engineering and Lobbying for Higher Taxes
- Energy Tax Hike Series: Raises Taxes on Tertiary Injectants
Wednesday, March 3, 2010
- Is This Reality or a Science Fiction Dystopia?
- Andy Stern Update: US Attorney Reviewing Case & Obama Appoints Stern to Debt Panel
- Texans: Do You Know Which Candidates Have Signed the Taxpayer Protection Pledge?
- AWF Asks White House to Take Position on Andy Stern Investigation After Appointment to Debt Panel (AWF Site »)
- AWF Continues Andy Stern Investigation (AWF Site »)
Tuesday, March 2, 2010
- Energy Tax Hike Series: Superfund Tax Reinstated
Monday, March 1, 2010
- Rick Berg First Pledge Signer in North Dakota Congressional Race
- Give a Hoot, Don’t Pollute . . .the Economy with Taxes or Unnecessary Spending
- Raise Taxes or Raise Taxes? Washington’s Solution to $2.8 Billion Budget Deficit
- Andy Stern Appointed to Debt Panel While Under Criminal Review for Lobbying Activities
- Andy Stern Appointed to Debt Panel While Under Criminal Review for Lobbying Activities (AWF Site »)
- Energy Tax Hike Series: IRS Sec. 199 Repeal
Friday, February 26, 2010
-
Pwned!
Paul Ryan on Healthcare and Deficits - Senator Inhofe Urges EPA to Reconsider Endangerment Findings
- Governor Crist Proposes $2.7 Billion Budget Increase
- Union Favorability Numbers Continue to Fall (AWF Site »)
- Real Men of Genius - DC City Council Edition: Cigarette Tax Hike Reduces Revenue
- Energy Tax Hike Series: Repeal of Percentage Depletion Deduction
Thursday, February 25, 2010
- Virginia Budget: Get Rid of the Tax Increases
- ATRF Analysis: Limit Earning Stripping by Expatriated Entities
- Bob McConnell the First Signer of the Taxpayer Protection Pledge in CO-03 Race
- Energy Tax Hike Series: Passive Loss Exception Repeal
Wednesday, February 24, 2010
- Ann Marie Buerkle Signs Taxpayer Protection Pledge in NY-25
Tuesday, February 23, 2010
The Obama Budget and Small Business
From Ryan Ellis on Tuesday, February 2, 2010 4:32 PM
President Obama today is touting all the advantages his budget has for small businesses. In particular, he's talking about using TARP funding (supposedly temporary, to be paid back to taxpayers) for small business lending.
Even if you limit yourself to the tax side of things, though, there are some pro-small business crumbs in the Obama budget: small business expensing is extended, a new jobs credit is created, and small business stock is exempted from capital gains. Good things, all, to one degree or another.
But there is one bad--very bad--tax increase on the small business sector in the Obama budget. Under his plan, the top two income tax rates increase from 33 and 35 percent to 36 and 39.6 percent. We've documented before that two-thirds of small business profits pay taxes in these bracket levels. Small businesses pass their profits through to their owners, who pay income tax on them. To raise taxes on "the rich" is a laser-beam tax hike aimed at small employers.
Small business owners also have to pay the Medicare portion of the self-employment tax at the high margin. Furthermore, they will face a phaseout of their itemized deductions (Pease) and personal exemptions (PEP) under the Obama budget, unlike 2010 law.
What does that mean for the marginal tax rate on small business activity? Assuming a 5 percent state income tax rate, the calculation is the following for a sole proprietor or general partner (S-corporation owners don't have to pay Medicare tax, so it will be slightly smaller for them):
| Tax | Rate |
| Federal Income | 39.6% |
| State Income | 5.0% |
| Self Employment | 2.9% |
| SE Deduction | (0.65%) |
| PEP and Pease | 2.34% |
| Total | 49.19% |
So, the top marginal tax rate on small business income will rise to 49.19 percent by my reckoning, up from about 41 percent today. This is a huge increase in the tax rate on most small business profits. I wonder if President Obama will be sharing this with entrepreneurs today?
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The Debt Panel's 800-lb. Gorilla: Why Andy Stern Stands Out - Tuesday, March 9, 2010 1:59 PM
We Ought Focus On Cutting Taxes & Spending, Not Deficits - Tuesday, March 9, 2010 1:07 PM
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Apply to Capital Gains? - Tuesday, March 9, 2010 10:46 AM
Taxpayers to Legislators: Clean Virginia Budget of Taxes - Tuesday, March 9, 2010 10:30 AM
ATR Urges Utah Governor Herbert to Veto Tax Increase - Monday, March 8, 2010 7:15 PM
Comments
It's obvious that the president, as well as many others, don't appreciate how measures ostensibly aimed at seizing wealth from the so-called "super-rich" actually have far-reaching repercussions - including, as this points out, on small businesses.
>> Phil Tuesday, February 2, 2010 4:48 PM
what are the current corporate taxes and dont these also affect these small businesses?
>> Clint Tuesday, February 2, 2010 5:21 PM
The corporate income tax rate is currently 35 percent. Most small businesses are not "C-corporations." Mostly, the CIT is paid by large businesses. This is also a very destructive tax to our economy.
>> Rellis Tuesday, February 2, 2010 6:25 PM