H.R.1425 - Bring Small Businesses Back Tax Reform Act115th Congress (2017-2018)
|Sponsor:||Rep. Hultgren, Randy [R-IL-14] (Introduced 03/08/2017)|
|Committees:||House - Ways and Means|
|Latest Action:||House - 03/08/2017 Referred to the House Committee on Ways and Means. (All Actions)|
This bill has the status Introduced
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Summary: H.R.1425 — 115th Congress (2017-2018)All Information (Except Text)
Introduced in House (03/08/2017)
Bring Small Businesses Back Tax Reform Act
This bill amends the Internal Revenue Code to establish new maximum individual tax rates for qualified business income that does not exceed $1 million (i.e., small business income). The maximum rates are: (1) 12% of such income not exceeding $150,000, and (2) 25% for income that exceeds $150,000 and is not more than $1 million.
The rates apply to up to $1 million of qualified business income that is: (1) gross earnings derived by an individual from any active trade or business carried on by the individual, excluding deductions attributable to the trade or business; or (2) the taxpayer's distributive or pro rata share of pass-through income from entities such as a partnership or S corporation. Qualified business income does not include capital gains, interest, dividends, or royalties.
For taxpayers that are not a corporation or a partnership with a corporation as a partner, the bill repeals the annual limitation on the election to expense certain depreciable business assets.
The bill also permits certain small businesses whose average gross receipts do not exceed $25 million (currently, $5 million) to use the cash accounting method without limitations and exempts such businesses from inventory rules.