PASS-THROUGH ENTITIES: OUR ECONOMIC ENGINE
Pass-through companies, which pay their business taxes through the individual income-tax code instead of the corporate code, are the backbone of the state and national economies. In Minnesota, these businesses employ 56 percent of the private workforce. Nationwide, they account for account for approximately 95 percent of businesses, employ more than 50 percent of the private-sector workforce, and face a marginal tax rate of more than 50 percent in some states.
Minnesota’s individual income tax rate of 9.85% is 4th highest in nation, and some pass-through entities have a marginal tax of nearing 50%, which is 4th highest in nation.
For more information on our 2015 legislative initiatives, read our summary.
Read the FAQ on pass-through entities.