Progress On Reinstating State And Local Tax Deduction For Small Businesses
MSCI’s partners at the S-Corp Association and at Parity for Main Street Employers report that there has been positive movement in several U.S. states regarding efforts to restore the federal state and local tax (SALT) deduction for businesses organized as S corporations, partnerships, and limited liability corporations (LLCs).
In Minnesota, for example, the House Tax Committee has considered legislation and heard testimony from from the Minnesota Chamber of Commerce, the National Federation of Independent Business, and the S Corporation Association on the benefits of the bill. A companion bill has been considered by the state senate, and the S-Corp Association says it is hopeful the legislation will be included in an omnibus tax bill later this year.
In Alabama, a state task force recently released a report that included a recommendation that Alabama restore the SALT deduction for smaller firms. Legislation to enact that recommendation already has been introduced in both the state House and the state Senate.
SALT restoration bills also have been introduced in both bodies of the Maryland Assembly and these bills appear poised to move through committee and to their respective chambers by the end of March. Lawmakers in Arkansas, Michigan, and New York are considering similar bills while Connecticut, Louisiana, New Jersey, Oklahoma, Rhode Island, and Wisconsin already have enacted legislation that would reinstate the federal SALT deduction for small firms.