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New Hampshire
Small business owners ask U.S. House tax writers to extend Trump-era deductions • New Hampshire Bulletin
WASHINGTON – As Congress gears up for negotiations ahead of the 2017 tax law’s expiration, economists and small-business owners urged U.S. lawmakers Thursday to extend or make permanent the Trump-era tax cuts.
Business owners from West Virginia and Wisconsin testified at a hearing before members of the House Committee on Ways and Means, advocating for the continuation of deductions that they say allowed them to reinvest in their operations.
The Tax Cuts and Jobs Act of 2017, which expires at the end of 2025, allowed some business owners to deduct up to 20 percent of qualified business income. The bill also temporarily cut taxes on new equipment purchases and other qualified assets, but those incentives are phasing out.
For individuals, the TCJA temporarily lowered marginal tax rates across most income levels and expanded the standard deduction and child tax credit, among other changes.
Large corporations saw the top corporate tax rate permanently drop to 21 percent from 35 percent.
“Seven years ago, Republicans passed the Tax Cuts and Jobs Act under President Trump, delivering relief to millions of families and small businesses and creating the best economy in our lifetime,” Committee Chair Jason Smith, a Missouri Republican, said during his opening remarks.
“Here’s the bottom line: Congress must act soon to prevent what will be the largest tax hike in history on workers, families, farmers, and small businesses,” he later added.
Democrats on the committee slammed the bill as a “corporate tax giveaway.”
“We knew that their tax scam would disproportionately benefit the wealthy and well-connected. We knew that it wouldn’t pay for itself. We knew that big corporations, not their workers, would feel the most benefit,” said the committee’s ranking member, Richard Neal of Massachusetts.
The Democratic-invited witness, Kathryn Anne Edwards, a labor economist at the RAND Corporation, said “unless the intention of the 2017 tax law was to directly transfer income to the richest Americans at incredible expense to ordinary Americans, it was a failure.”
Extending the law could cost the government between $3.3 trillion and $3.6 trillion over the next 10 years, Edwards told the panel, citing estimates from the Committee for a Responsible Federal Budget and the Tax Policy Center.
A ‘landmark’ change
But small business owners say the law has been a financial lifeline.
Michael Ervin, founder of Coal River Coffee Company in St. Albans, West Virginia, told the panel that his five-year-old business has benefited from the 2017 tax code changes, particularly the temporary income deductions for sole proprietorships, partnerships, and S-corporations.
“After the passage of the Tax Cuts and Jobs Act, LLCs, and other pass-through businesses like mine were able to benefit from the newly minted Small Business Deduction, also known as the 199(a) deduction. This provision has allowed me to deduct up to 20 percent of my business income, which has let me invest in my business, my employees, and my community,” said Ervin, who employs roughly a dozen people.
If Congress does not extend the special deduction or make it permanent, Ervin told lawmakers that he will face a “significant tax hike” and be at a disadvantage compared to nearby large businesses.
“Down the street from my location is a larger competitor, Tim Hortons. In two years, if my taxes go up, the corporate rate will remain 21 percent. Tim Hortons will be paying a 21 percent federal rate and a 6.5 percent state corporate rate for a total combined rate of 27.5 percent, while my total combined rate will be closer to 45 percent. This disparity will make it extremely difficult for me to compete,” Ervin told lawmakers.
Austin Ramirez, president and CEO of the Wisconsin-based Husco International Inc., also told the panel that the pass-through deduction has “leveled our playing field with our peers organized as corporations.”
Husco, a privately held family-owned manufacturer of hydraulic and electromechanical parts for vehicles, employs about 1,600.
Ramirez said the TCJA enabled his business to do the “most significant renovation of our Waukesha, Wisconsin, headquarters in 70 years.”
The company has invested $50 million to renovate its office space and shop floor, allowing the addition of nearly $150 million to its top line since 2017, Ramirez said.
Temporarily extending Trump tax cuts
Going forward, Smith said, congressional tax writers should note that the law “provided a critical blueprint that Congress can build upon to make lasting improvements to our tax code.”
“The House has already shown strong bipartisan support for key provisions of the 2017 law by passing the Tax Relief for American Families and Workers Act earlier this year. But there is still much work to be done,” he said, referencing a bill he sponsored and negotiated with Democratic Sen. Ron Wyden of Oregon.
The hearing happened against the backdrop of stalled negotiations in the U.S. Senate on the act referred to by Smith, a short-term tax bill that garnered rare widespread bipartisan support in the House in January.
The bill, which would temporarily revive expired or expiring business tax breaks and expand the child tax credit, passed on a 357-70 vote.
While House Republicans overwhelmingly supported the legislation, GOP senators oppose provisions of the bill that would temporarily expand the refundable portion of the child tax credit and allow households to calculate the credit based on their previous year’s earnings, if higher than the current year’s.
Business owners at a February hearing before the Senate Committee on Finance implored the upper chamber to pass the bill.
Ramirez, the Waukesha business owner, also expressed on Thursday to the committee his support for the Tax Relief for American Families and Workers Act, which would revive an expired 2017 incentive for businesses that allowed them to immediately write off research and development expenses.
“Husco’s inability to expense these costs since 2022 has cost us more than $20 million in liquidity, wiping out a large portion of the TCJA benefits and creating a disincentive to invest in innovation,” Ramirez testified.
Other temporary measures enacted under the TCJA expire on Dec. 31, 2025.
Crime
Elijah Allman’s arrest on March 1 was his second in New Hampshire in a matter of days.
A court hearing for Cher’s son Wednesday over allegations he broke into a New Hampshire home this month has been canceled.
Elijah Allman’s arrest on March 1 was his second in New Hampshire in a matter of days. Allman, the 49-year-old son of the iconic singer and actress, was also detained Feb. 27, accused of acting belligerently at a prestigious prep school in Concord.
It is unclear if Allman, of Malibu, California, has any connection to the home in Windham, New Hampshire. He is being held in the Rockingham County Department of Corrections, Superintendent Jonathan Banville said.
The hearing Wednesday was continued until an undetermined date after Allman got an attorney Wednesday morning. The attorney, Sarah Landres, did not respond to a request for comment.
Allman, whose father was the late singer Gregg Allman, is charged with two counts of criminal mischief, one count of burglary and a count of breach of bail for breaking into the home on March 1. Police said in a report that Allman did not have permission to be at the home and forcibly entered it.
Officials at St. Paul’s School said Allman last month identified himself as the parent of a prospective student and slipped into the dining hall as some students were leaving the building. Police responded to reports that he was disturbing people in the building.
He was charged with four misdemeanors in the school incident: two counts of simple assault, criminal trespass and criminal threatening. Allman was also charged with a violation of disorderly conduct, which is illegal in the state but not considered a crime. He was released on bail.
Allman did not respond to an email requesting comment, and a phone number for him was not working.
In December 2023, Cher filed a petition to become a temporary conservator overseeing her son’s money, saying Allman’s struggles with his mental health and addiction have left him unable to manage his assets and potentially put his life in danger.
The petition says the superstar performer’s son is entitled to regular payments from a trust fund. But “given his ongoing mental health and substance abuse issues,” she is “concerned that any funds distributed to Elijah will be immediately spent on drugs, leaving Elijah with no assets to provide for himself and putting Elijah’s life at risk,” the petition says.
Los Angeles Superior Court Judge Jessica Uzcategui denied the request, saying she was not convinced that a conservatorship was urgently needed. Allman was in the courtroom with his attorneys, who acknowledged his previous struggles but argued that he was in a good place, was attending meetings, getting treatment and reconciling with his estranged wife.
The son of Cher is scheduled to be in court Wednesday for a hearing over allegations he broke into a New Hampshire home earlier this month.
It was the second arrest in a matter of days for Elijah Allman, 49, of Malibu, California, who was detained Feb. 27 after allegedly acting belligerently at a prestigious prep school in New Hampshire. It was unclear if Allman had any connection to either St. Paul’s School or the home in Windham, New Hampshire.
Allman remains in the Rockingham County Department of Corrections in what is called preventive detention, Superintendent Jonathan Banville said.
Allman, whose father was the late singer Gregg Allman, faces two counts of criminal mischief, one count of burglary and a count of breach of bail for breaking into the home on March 1. Police said in a report that Allman did not have permission to be at the home and forcibly entered it .
In the incident at the prep school, Allman was charged with four misdemeanors: two counts of simple assault, criminal trespass and criminal threatening. Allman was also charged with a violation of disorderly conduct, which is illegal in the state but not considered a crime.
At about 7 p.m. that day, Concord police responded to reports that Allman was disturbing people in the dining hall of St. Paul’s School. After charging Allman, police said he was released on bail as his case works through the court system.
Allman did not respond to an email requesting comment, and a phone number for him was not working. It was unclear from the court records if Allman has an attorney.
In December 2023, Cher filed a petition to become a temporary conservator overseeing her son’s money, saying Allman struggles with mental health issues and addiction have left him unable to manage his assets and potentially put his life in danger.
The petition from the singer and actress said Elijah Allman is entitled to regular payments from a trust fund. But “given his ongoing mental health and substance abuse issues,” she is “concerned that any funds distributed to Elijah will be immediately spent on drugs, leaving Elijah with no assets to provide for himself and putting Elijah’s life at risk,” the petition says.
A few weeks later, Los Angeles Superior Court Judge Jessica Uzcategui denied the request, saying she was not convinced that a conservatorship was urgently needed. Allman was in the courtroom with his his attorneys, who acknowledged his previous struggles but argued that he is in a good place now, attending meetings, getting treatment and reconciling with his previously estranged wife.
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