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Friday, February 25, 2011

Geithner: End Pass-Through Treatment of LLCs, Partnerships & S Corps

Bloomberg News, Geithner Seeks to Broaden U.S. Corporate Tax Overhaul Debate:

The Obama administration is seeking to widen the scope of its proposal to overhaul the corporate tax code, urging Congress to also change rules that allow some businesses to take advantage of tax laws governing individuals.

U.S. Treasury Secretary Timothy Geithner told the Senate Finance Committee Feb. 15 that Congress should “revisit” long- standing rules that give businesses a choice of paying taxes as a corporation or through a structure such as a partnership through which they can report business income on individual tax returns.

The recommendation, which Geithner repeated in a meeting with reporters this week at Bloomberg News in Washington, would affect income earned by the nation’s largest law firms, investment partnerships and so-called S corporations. It would more than double, to about $3 trillion, the amount of business income potentially affected by tax-law changes.

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Comments

The war on the middle class continues. Is Geithner crazy or just carrying the lunch pail of his employer in the White House. Having been a first class tax evader himself, one must look at any tax proposal he affirms with a clear eye.

Posted by: Shotgun | Feb 25, 2011 2:34:04 PM

We had to destroy the village to save it.

Is he really talking about every small business partnership, LLC and S-corp? Wow.

Posted by: save_the_rustbelt | Feb 26, 2011 2:01:08 PM

This seems to me to be a second bite at the apple to undo extending the Bush Tax Cuts. Rates might be lowered, but the business owners and professionals that make up the majority of those "wealthy" people the Obama Administration hoped to tax at higher rates would be taxed twice (i.e., at the entity level and the individual level). Thus, the tax "on the rich" would be accomplished as hoped, just by different means.

Posted by: GOPNYC | Mar 1, 2011 5:33:32 AM

This is straight from the Clinton era. (Like everything else lately--can't he at least be original?) And this is supposedly a small business friendly era?! If they do this, I'm done. I've had it.

Posted by: Rocco | Mar 1, 2011 7:04:02 AM