Will he cut small business taxes, or won't he? Donald Trump's campaign has two different answers, depending on which conservative activists it's talking to...

At issue is whether Trump's proposed 15% corporate tax rate would also apply to income earned from small businesses that have a "pass through" tax status and hence don't pay a separate corporate tax (i.e., S-corps, partnerships, LLCs, and so forth). This would be HUGE for small businesses if it applies.

The current statement directly from Trump's web site (emphasis added) is:

The Trump Plan will lower the business tax rate from 35 percent to 15 percent, and eliminate the corporate alternative minimum tax. This rate is available to all businesses, both small and large, that want to retain the profits within the business.

What does that highlighted portion of the statement mean? It has no real tax or legal meaning, because currently, money "retained" within the business typically gets some sort of deduction, so it isn't taxed anyways. Most likely, this statement was a kind of rhetorical dodge (i.e., intentionally having no concrete meaning) to avoid committing to the pass-through business tax cut (which would indeed be "expensive", federal budget-wise). The question, then, is which way the administration will break on this point, now that the campaign is over.

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