The Utah chapter of the National Federation of Independent Business (NFIB) is cheering congressional action that made the 20 percent Small Business Tax Deduction permanent late last year.
In place on a temporary basis since 2017, the bill has allowed small businesses to deduct up to 20 percent of their business income. Without action by Congress, the tax deduction was set to expire at the end of 2025.
“This has helped (small businesses) to grow, hire, invest in their employees, and give back to their communities,” the NFIB said in a statement.
The NFIB recently released a report outlining the economic benefits and tax savings the deduction brings to 371,569 small businesses in Utah now that it has been made permanent. The report also details several other federal tax-relief wins that were signed into law.
The NFIB report said Utah is projected to gain 16,000 jobs annually over the next 10 years if the deduction remains in place, including an annual GDP increase of $816 million for the first decade and $1.7 billion per year
beyond 2035.
The full report can be found on the NFIB website, www.nfib.com.
“This year’s Tax Day is good time to once again thank Utah’s congressional delegation for their work in making the Small Business Deduction permanent, instead of letting it expire at the end of last year,” said Casey Hill, state director for NFIB in Utah. “To call it a historic accomplishment is not an overstatement. More than 80 percent of small businesses are organized as pass-through entities for federal tax purposes and report their business earnings and expenses on their personal income
tax forms.”
“Thanks to the now-permanency of the Small Business Deduction, combined with the Utah Legislature’s passing, and Gov. Spencer Cox’s signing, of SB60, small-business owners have clearer certainty to decide on whether to hire more workers, give raises to current employees, or buy new equipment,” Hill continued. “For other Main Street entrepreneurs, it’s a lifeline to remain solvent long enough to turn their businesses back in the direction of profitability.”
After being passed by Congress, President Donald Trump signed legislation to make the Small Business Tax Deduction permanent.
“This permanent tax relief means America’s small businesses can use more of their hard-earned money to support their business and employees instead of sending it to their state and federal government,” the NFIB statement said. “It also provides certainty and levels the playing field for small businesses against their large corporate competitors.”