Small Business Update: Tax Reform and More | NFIB
NFIB President Juanita Duggan shares a recap of the recent tax reform victory and a preview of what’s to come in 2018.
As the voice of small business, NFIB works to affect positive change on behalf of our members. Below is a list of recent victories by our Legal Center, Political, and Government Relations teams.
NFIB’s Policy Victories:
- Judge Neil Gorsuch confirmed to be an Associate Justice of the Supreme Court of the United States.
- Judge Brett Kavanaugh confirmed to be an Associate Justice of the Supreme Court of the United States.
- Created a 20% Small Business Deduction for all businesses organized as sole proprietorships, S-Corps., partnerships, and LLCs, with taxable incomes below $163,300 individual/$326,600 joint, for tax year 2019. Pass-through businesses with taxable income above $163,300 individual/$326,600 joint for tax year 2020 can still benefit from the Small Business Deduction if they are employee intensive or make capital expenditures.
- Permanently increased Section 179 small business expensing threshold to $1.04 million from $510,000, and indexed threshold to inflation.
- Reduced individual tax rates for many taxpayers using the following rates: 37%, 35%, 32%, 24%, 22%, 12%, and 10%.
- Extended cash method of accounting to many businesses that are below $26 million in annual gross receipts on average for the past three years for tax year 2020, indexed.
- Increased individual Alternative Minimum Tax (AMT) thresholds to apply only above $518,400 individual/$1,036,800 joint for tax year 2020, indexed.
- Reduced and flattened the corporate tax rate to 21% and repeals the corporate Alternative Minimum Tax.
- Roughly doubled to $12,400 individual/$24,800 joint for tax year 2020, indexed.
- Provided estate tax relief that excludes roughly $11.58 million individual/$22.16 million joint for tax year 2020, indexed.
Put the Brakes on Burdensome Regulations
- NFIB recently prompted a deregulatory reform by the Department of Interior that benefits landowners across the country. Thanks to a request filed by the NFIB Small Business Legal Center, the federal government issued new rules that encourage private conservation without a blanket prohibition on private land use.
- NFIB’s lawsuit successfully blocked EPA’s “Waters of the U.S. Rule,” which would have expanded the jurisdictional reach of the EPA and Army Corps of Engineers by prohibiting landowners from developing any portion of land that is even occasionally wet without an expensive federal permit.
- Litigation filed by NFIB resulted in the Labor Department rescinding the so-called “Union Walk Around Rule,” which would have allowed union representatives to accompany OSHA inspectors when inspecting non-unionized companies.
- NFIB successfully blocked a paid leave sick ordinance that would have set a national precedent for labor activists. In response to NFIB’s lawsuit, a Texas court blocked the City of Austin’s paid sick leave ordinance. Local measures such as Austin’s paid sick leave ordinance would result in a patchwork of rules and regulations that create major problems for small businesses.
Repealed Harmful Provisions in Obamacare
- Repealed the financial penalty stemming from failure to meet the Affordable Care Act’s (Obamacare’s) individual mandate requirement.
- Expanded the maximum length of short-term limited duration insurance (STLDI) plans from three to 12 months, and potentially up to 36 months with renewals. This is another positive step for small business owners seeking more affordable, flexible, and predictable options for themselves and their employees.
- Led efforts for a one-year moratorium on the small business health insurance tax (HIT) for 2019, resulting in a $500 per family reduction in health insurance premiums. NFIB will continue to push for repeal of the harmful tax.
NFIB’s Legal Center Victories
- Legal Center listed as one of the top-ten most influential groups to file briefs in the U.S. Supreme Court by the SCOTUSblog.
- Responsible for obtaining a federal court decision that blocked a Department of Labor FLSA/overtime rule that would have impacted 44% of small businesses.
- Scored big wins in two major 2016 Supreme Court cases–striking down an unfair Clean Water Act ruling and upholding attorney’s fees awarded to a wrongfully accused employer.
- Filed over 50 amicus briefs in 2016, including 25 in the U.S. Supreme Court.
- Sued and stopped the U.S. Department of Labor from implementing the pro-union “persuader” reporting rule that would have limited small business access to labor attorneys.
- Obtained a U.S. Supreme Court emergency order to block the Environmental Protection Agency’s Clean Power Plan. President Trump has vowed to overturn this rule.
- Successfully blocked EPA’s Waters of the U.S. Rule that radically expands the jurisdictional reach of the Environmental Protection Agency and Army Corps of Engineers. Under this Rule, ordinary landowners will be prohibited from developing any portion of land that is even occasionally wet without an exorbitantly expensive federal permit. President Trump has vowed to permanently overturn this rule.
- In a 7-1 victory, the Supreme Court agreed with NFIB’s brief and adopted a more sensible, reasonable limit on the Equal Employment Opportunity Commission’s investigatory powers.
- Successfully rescinded the “Union Walk Around Rule.” NFIB argued that OSHA violated the law in announcing the “Union Walk Around Rule,” which was created outside the normal rulemaking process and allowed union representatives to accompany OSHA inspectors when inspecting non-unionized companies.
- EPA initiated a formal proposal to rescind the Clean Power Plan. In 2015, NFIB joined with other industry groups, and 24 states, and sued in federal court to stop EPA’s enforcement of the rule. In response to the lawsuit, the U.S. Supreme Court, in an unprecedented decision, issued an injunction preventing EPA from enforcing the rule until lower courts could decide the merits of NFIB’s claim.
NFIB’s Election Victories
- NFIB Fed PAC endorsed 272 congressional candidates. 77% of those endorsed U.S. House and Senate candidates won their races.
- In 2018, NFIB elected 4 new NFIB members to Congress. There are currently 26 serving in the 116th Congress.
America’s small business owners are busy running their businesses. As the nation’s leading small business advocacy organization, NFIB is busy working hard in the effort to overcome the challenges you and hundreds of thousands of small business owners face on tax reform, ever-expanding government regulation, and healthcare. Below are a list of challenges from our Legal Center and Federal Public Policy teams.
Healthcare Cost Relief
- NFIB led efforts for a one-year moratorium on the small business health insurance tax (HIT) for 2019, resulting in a $500 per family reduction in health insurance premiums. NFIB will continue to push for repeal of the harmful tax.
Regulatory Reform and Relief
- While Congress overturned specific regulations utilizing the Congressional Review Act (CRA), Congress has not reformed the regulatory process to consider the impact of proposed regulations on small businesses more fully.
- NFIB will continue to oppose legislation requiring small business owners to file reports containing personal information with the Financial Crimes Enforcement Network (FINCEN) under the threat of significant penalties.