House Approves Tisdel's New Tax Plan For Small Businesses

ROCHESTER HILLS, MI — State Rep. Mark Tisdel’s house bill to help small businesses save on federal taxes earned bipartisan support in a Thursday house vote.

The legislation was approved by a vote of 105-2 in the Michigan House of Representatives. The plan now advances to the Senate for consideration.

The bill proposes a new tax flow-through organizations could pay instead of the income tax. The alternative tax would be paid at the entity level, so the limit for the federal SALT (State and Local Taxes) deduction would not apply.

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Businesses organized as flow-through entities, such as S corporations, partnerships and LLCs file taxes through the individual owners, which means their state and local taxes deductions are limited to $10,000.

The bill however, aims to allow these smaller entities to file taxes at a business level, similar to C-type corporations, so they may claim an unlimited SALT deduction.

"The owners and workers who run the small businesses in our communities are our friends and neighbors," Tisdel said. "These businesses deserve a fair tax system, and my plan will help many small businesses expand their tax savings and benefit local economies."