NFIB supports maintaining lower marginal tax rates. The 2017 tax law reduced five out of seven individual income tax rates. This adjustment directly impacts nine out of 10 small businesses organized as pass-through entities, as their income is taxed accordingly. With these adjustments set to expire at the end of 2025, 90% of small businesses will see their effective tax rates increase significantly. 

 NFIB supports reinstating a lower tax rate for small businesses organized as C-corporations (C-corps). Nearly 20% of small employers are legally structured as C-corps. In 2017, TCJA implemented a 21% corporate tax rate for these businesses. However, in doing so, the law eliminated provisions that allowed for small businesses with less than $50,000 in taxable income to utilize a 15% rate. The effect of this flat rate was a tax increase for these small businesses. NFIB urges Congress to reinstate this lower tax rate for these businesses and adjust the taxable income threshold for inflation. 

 NFIB supports repeal of the estate tax. The Tax Cuts and Jobs Act increased the estate tax exemption from $5.5 million for individuals and $11.1 million for those filing jointly. The increase had the effect of exempting more small family businesses from the reach of the estate tax. For tax year 2025, the exclusion was increased to $13.99 million for individuals and $27.98 million for those filing jointly. This expires at the end of 2025, and the exemption rate will be cut in half, hindering business growth and expansion.