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Comment by ttcbj | Hacker News Reader

Thanks for posting this, I have been looking for just such a summary. I think I will be a significant beneficiary of this provision (as I currently understand it, anyway), but I agree with other commenters that I wish we could just make things simpler and more fair.

Over the last 10 years I have had experience with small business taxes, small business retirement plans, and various estate-tax avoidance schemes. The tax code is a joke. It rewards people who have the resources to game it, and it employs an entire class of people who specialize in doing just that. Its demoralizing, but while it exists, everyone has to play the game.

Edit: Also, that same site has an even more detailed summary of the deduction here:

https://evergreensmallbusiness.com/sec-199a-qualified-busine...

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Agreed. As a small business (pass through LLC) owner, I'm willing to pay just about any tax that's demanded of me as long as every one of my peers is subject to the exact same taxation. If the tax is so high that it puts me out of business, I want to know that every one of my competitors is out of business, too. If the tax is so high it forces me to close my physical shop and go online, I want to know my competitors are all closing their doors too. And if I'm making record profits, hey now I can focus on competing on the merits of my product.

But if I have to shut down while my competitors stay open just because they hired a better CPA? Especially as a small business? That's a problem for me. A much bigger problem than the tax rate being 22% instead of 21%.

"I agree with other commenters that I wish we could just make things simpler and more fair."

That's what was so nice about a pass-through entity: It was both politically and revenue neutral. All of the profits flowed through to the taxpayer and the politics and revenue occurred there. Terms like "fairness" had no relevance to them.

It could not have been simpler and it was completely outside the sphere of the political discussion on taxes.

But now, by answering a question that nobody asked, the new tax code politicizes the passthrough entity and, in my opinion, will eventually lead to its discontinuance - or at the very least, layers of complication added every time we revisit this topic.

I benefit maximally from this change to passthrough entities but it is a benefit I never asked for and that will hurt me (and all of us) in the long term.

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