The House Republican plan to cut taxes for small businesses has a big problem: Most apparently won’t benefit from it.
The typical small business, whether it’s a sole proprietorship, partnership or limited liability company, doesn’t pay taxes itself, but its owners do as individuals.
And already about 86% of these so-called pass-through businesses pay no more than 25% under the individual code, the new top rate proposed for small-business income in the tax bill unveiled this week. So they won’t get the legislation’s much-hyped small-business tax cut.
On top of that, the bill makes it very difficult for lawyers, engineers, doctors, consultants and other personal services...