New Survey Highlights Importance of Guidance in Making Pass-Through Provisions Successful
The Parity for Main Street Employers (PMSE) coalition released a new survey highlighting the pass-through business community’s initial reaction to the tax Cuts and Jobs Act (TCJA). Early Results indicate hat the tax relief promised to non-corporate employers is in danger absent clear guidance from IRS and Treasury. Key results include:
- Half of the businesses surveyed were still unsure whether their tax burden would go up or down under the new tax law.
- More than one-third responded that they are unsure if they will get the new pass-through deduction.
- For those businesses reporting that they will not get the full deduction, one in four reported they were subject to the wage limit.
“Our survey shows that Main Street Employers are frozen by uncertainty over the new tax law” stated Chris Smith, Executive Director of the Parity for Main Street Employers coalition. “Nearly half the companies surveyed still don’t know how the law will affect them or if they will qualify for the new deduction. This uncertainty is curbing the law’s ability to increase job growth and investment. The survey reinforces the importance of Treasury issuing timely, well-constructed and pro-growth rules to implement these provisions.”
The PMSE survey was sent to the membership of PMSE trade groups and represents an initial look into how the new law is viewed by pass-through businesses (S corporations, partnerships and LLCs). The survey used Survey Monkey and includes the voluntary responses of nearly 200 businesses received over the past month.
For more information on PMSE and the survey, please visit mainstemployers.org.
Main Street Employers are the backbone of the American economy—employing the majority of U.S. workers, and comprising 95% of all U.S. businesses. By organizing as S corporations and other pass-through businesses, they help keep family businesses in the family, and make America more innovative and competitive. That’s why we need a federal tax code that restores parity between corporations and pass-through businesses.