You can't make this stuff up. Republicans are trying to pass off Koch Industries and Bechtel as "small business", deserving of a 20% tax deduction on their total income. I'm still reading their 21-page monstrosity, but this one
You can't make this stuff up. Republicans are trying to pass off Koch Industries and Bechtel as "small business", deserving of a 20% tax deduction on their total income. I'm still reading their 21-page monstrosity, but this one jumped out at me.
Here's how it works: Some companies are umbrella companies with many subsidiaries. The parent is generally a "pass-through entity." Typically they are identifiable as LLCs or Limited Partnerships, where the income passes through to the owners. It's often used because the pass-through avoids the possibility of excess profits becoming dividends, taxed at a higher rate.
These entities don't pay corporate taxes, but their owners do pay personal income taxes on the profits passed through. So now let's look at the Republican plan for "small business".
Page 8: Give Small Businesses a Tax Deduction: We will allow small business owners to take a tax deduction equal to 20 percent of their business income. This will provide entrepreneurs with a much-needed infusion of capital for infusion and new hiring.
So, here's how that works: Koch Industries, Inc. makes a zillion bucks, passed through to the Koch Brothers as owners, they pay tax on a zillion bucks. Under the GOP plan, they'll make a zillion bucks, deduct 20% of it as a corporate deduction, leaving a passthrough of 80% of a zillion to pay personal taxes on. See how that works? A double dip! A freebie tax deduction and then 20% less taxable income to the owners.
There's some fiscal responsibility for ya. Giving the Kochs an extra piece of their zillion to fund more astroturf, more voter suppression, more tea party nonsense.
Please, someone tell me how they keep getting away with this.