H.R.703 - Main Street Tax Certainty Act (119th Congress)
Summary
H.R.703, the Main Street Tax Certainty Act, proposes to amend the Internal Revenue Code of 1986 to make the deduction for qualified business income (QBI) permanent. This bill was introduced in the House of Representatives on January 23, 2025, and referred to the Committee on Ways and Means. The primary aim is to eliminate the sunset provision of Section 199A, ensuring that eligible small businesses can continue to deduct up to 20% of their qualified business income indefinitely.
Expected Effects
If enacted, H.R.703 would provide long-term tax certainty for small businesses, allowing them to plan and invest with greater confidence. Making the QBI deduction permanent could stimulate economic activity within the small business sector. This may also simplify tax planning for affected businesses.
Potential Benefits
- Provides long-term tax certainty for small businesses.
- Encourages business investment and expansion.
- Simplifies tax planning for eligible businesses.
- Potentially stimulates economic growth through the small business sector.
- May lead to increased job creation within small businesses.
Most Benefited Areas:
Potential Disadvantages
- Could increase the national debt if not offset by other revenue increases or spending cuts.
- May disproportionately benefit higher-income small business owners.
- Could complicate the tax code by creating a permanent, complex deduction.
- May incentivize tax avoidance strategies.
- Could reduce overall tax revenue, potentially impacting government programs.
Most Disadvantaged Areas:
Constitutional Alignment
The bill falls under Congress's power to lay and collect taxes, duties, imposts, and excises, as outlined in Article I, Section 8, Clause 1 of the Constitution. The bill does not appear to infringe upon any specific constitutional rights or protections. The constitutionality hinges on whether the tax policy serves the general welfare, a broad interpretation of which has historically been upheld by the courts.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).