U.S. Rep. Ron Kind and U.S. Rep. Dave Reichert (WA-08) today introduced the S Corporation Modernization Act (H.R. 1478), a tax relief proposal that would make it easier for S corporations to access capital, compete, and hire new workers by modernizing outdated rules that currently stifle their growth. Among many findings, an independent study released this morning revealed how S corporations employ one out of four private sector workers (31 million) in the United States.
"This bill is a commonsense update to the tax code that will give S corporations the ability to grow and prosper especially in this tough economic environment," Rep. Kind said. "It is critical that we ease the tax burden on our small and family owned businesses who are driving our economic growth. Under this legislation, S corporations will be better able to access credit, invest in their business, and create the good paying jobs that we need."
"S corporations and other similar businesses are responsible for more than half of the jobs in Washington State and across America," Rep. Reichert said. "As our economy struggles to get back on sound footing, I'm proud that this bipartisan legislation will help these proven job creators access the capital needed to grow, compete, and help get more and more Americans back to work. I remain committed to supporting these bedrocks of our economy by advocating for pro-growth tax policies from my position on the Ways and Means Committee."
"Tax reform should seek to make the entire U.S. economy more competitive, not just a subset of large corporations," stated S Corporation Association Executive Director Brian Reardon. "If you're going to tackle tax reform, it must include both the corporate and individual tax codes in order to assist all employers. In the face of proposals that would make the majority of America's employers less competitive, the Reichert-Kind legislation presents a realistic set of reforms that would improve the ability of 4.5 million S corporations to access much-needed capital and increase their hiring capabilities."
Specifically, H.R. 1478 would make needed changes to keep S corporations competitive and help ensure the continued success of America's predominant private business model by:
* Increasing the ability of S corporations to access much-needed capital;
* Modernizing the rules that apply to firms that have selected S corporation status; and
* Enabling IRAs to hold stock in S corporations.
These reforms would improve the ability of S corporations to respond to the demands of the current business environment and remove impediments that prevent them from competing on a level playing field here in the United States.