A new coalition, launching this Thursday, is strategically targeting centrist Democrats to advocate for a critical tax deduction affecting pass-through business income. The initiative, spearheaded by the tax policy practice at Brownstein Hyatt Farber Schreck, is known as the PROTECT Coalition—Passthroughs Relying On Tax Equity & Championing Thriving Businesses. This group aims to advance lobbying efforts for businesses that seek to maintain the 20% deduction provided under Section 199A of the U.S. tax code, set to face legislative challenges ahead of the 2025 tax cliff.
The 199A tax deduction, established by the 2017 tax law, benefits owners of various business structures including partnerships, S corporations, and sole proprietors who report their income through individual tax filings. The deduction is projected to cost $415 billion between 2018 to 2027, making it a significant fiscal element in upcoming tax policy debates. This makes the support of moderate Democrats, who hold pivotal votes, crucial to the future of the tax break. For more details, the full article can be read on Bloomberg Tax.