Small-business owners worried about efforts to raise the corporate tax rate should sort out what the potential changes mean for them but shouldn’t rush to make dramatic changes before the dust settles, experts say.
The Biden administration and Democrats in Congress are attempting to pass a $3.5 trillion spending bill for “soft infrastructure,” such as child care and child tax credits, climate change mitigation and more. But the bill also includes a set of changes to the corporate tax rate. The Biden administration initially released its own proposal calling for a corporate tax rate of up to 28%.
Annette Nellen, professor and director of the graduate tax program at San Jose State University, said the actual legislation pushed by the House Ways and Means Committee proposal — which raises the corporate rate from 21% to 26.5% — also brings back a graduated rate for businesses of different sizes.
