Sponsors (46)
Making the 20% pass-through (QBI/Section 199A) deduction permanent provides tax relief and planning certainty for small businesses and taxpayers but reduces federal revenue, tends to favor higher earners, and creates ongoing administrative burdens.
Small-business owners and individual taxpayers who claim the 20% qualified business income (QBI/Section 199A) deduction keep that deduction permanently, lowering taxable income and potentially reducing their tax bills.
Taxpayers and lenders gain greater certainty for tax planning and financing because eliminating the sunset removes the risk that the 20% QBI deduction will expire.
All taxpayers face higher long-term federal deficits or pressure on other spending/taxes because permanently forgoing revenue from the deduction reduces federal receipts.
Higher-income owners of pass-through businesses continue to benefit from the deduction, which may worsen tax equity by subsidizing income for higher-earning filers.
Treasury/IRS and related financial institutions face increased ongoing administrative workload for guidance, compliance, and enforcement to determine and monitor who qualifies for the permanent deduction.
Based on analysis of 2 sections of legislative text.
Permanently makes the Section 199A qualified business income deduction available by removing its scheduled expiration.
Makes the qualified business income (QBI) deduction under section 199A permanent by removing the statutory provision that allowed that deduction to expire. The change affects individuals and owners of pass-through businesses who claim the QBI deduction and changes the Internal Revenue Code so the deduction no longer sunsets.
Introduced January 23, 2025 by Steve Daines · Last progress January 23, 2025