Nov. 01, 2018 — The Small Business Legislative Council joined ICBA in calling on Congress to make permanent the lower tax rates on pass-through businesses scheduled to expire at the end of 2025. In a statement to the Senate Small Business Committee, the organization also noted that the Tax Cuts and Jobs Act unnecessarily excludes many pass-through entities from the law’s 20 percent deduction on income.
Separately, ICBA is calling on the Treasury Department and IRS to allow all permissible banking activities to be eligible for the deduction. Citing Section 199A of the law, their August proposed rule names various financial services that do not qualify for the deduction, such as trust or fiduciary services, wealth management, retirement planning, and income from loans sold to be securitized.
A group of 12 senators led by Sen. Jerry Moran (R-Kan.) recently joined the debate with an ICBA-supported letter calling on Treasury to revisit the proposed rule, which they said unreasonably limits the deduction. That letter followed an IRS hearing in which four community bankers testified on the need to narrowly define services ineligible for the Subchapter S deduction.