Pass-through Business Income tax

Pass-through Business Income Tax Details
United for Jobs Pass-through Business Income Tax Policy Details
“Many Minnesotans do not understand that 92% of Minnesota businesses pay their taxes through the individual income tax, and that they account for 54% of all net business income in the state. For many successful businesses, this can mean they experience close to a 50% tax rate between state and federal taxes. For businesses like UMC, that require large amounts of capital to drive growth, with a 50% tax burden we have diminished funds to invest toward growing the company and hiring more employees.” – Eric Gibson, President, UMC, Inc., Monticello
“Minnesota needs to be much more competitive from a tax perspective for pass-through entities. We are a subchapter S company and, as such, our owner reports business income on his personal tax return. We need to see the personal income tax burden reduced so we have more dollars available for reinvestment in our company, including employees and equipment. At present, the companies we compete with in our industry don’t have the tremendous tax burdens we face in Minnesota, and so we just want a level playing field. Removing or reducing the fourth-tier tax rate, increasing research-and-development tax credits and providing business property tax relief for Minnesota pass-through entities would be welcome changes.” – Rick Trontvet, Vice President, Administration and Human Resources, Digi-Key Electronics, Thief River Falls

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