The real story on small business taxation under the Obama plan

October 29, 3:56 PMProgressive Politics ExaminerJay McDonough

Previous Next

4 comments Print Email RSS Subscribe

Subscribe

Get alerts when there is a new article from the Progressive Politics Examiner. Read Examiner.com's terms of use.

Email Address   Include other special offers from Examiner.com Terms of Use

Ever since John McCain raised the story of Joe the Plumber (or whatever he actually is) during the third presidential debate, his campaign has made an issue out of small business taxation, asserting Obama's economic plan discourages small business ownership.  McClatchy breaks it down:

Roughly 75 percent of small businesses file as individual tax filers, not corporations, and most report their business income using various tax forms, called schedules, for income from business ventures, farming or rental properties.

Using these three income-reporting categories, the Tax Policy Center has concluded that 1.9 percent of all individual filers reporting business income would see their taxes go up under Obama's plan. Of those who get more than 50 percent of their income from business ventures, 2.7 percent would pay higher taxes.

That 1.9% of small businesses would see their taxes rise from 35% to 39.5%.  The 35% rate is a result of the Bush Administration's tax cuts and the 39.5% represents the tax rate through much of the 1990's.