About Obama raising taxes on 50% of Small Business revenue

[Kurt_and_Hunter]

A "small business" can gross $30 million/year and have 500 employees. That kind of SB could be the top employer and economic power in a small town!

So, of course, the majority of small business revenues are concentrated in the sliver of very large small businesses.

Very few small businesses would see any tax increase under Obama, and the few who would are far from charity cases.

Most small businesses gross a decent amount of money but will never show $250,000 profit in a year, ever. And profit is what is taxed, not gross receipts.

Any small business that shows over $250,000 in annual profits is NOT a Mom and Pop operation hanging on for dear life.

[LSparkle]

1. Bravo! I've been screaming this at my TV every time it comes up

I think Obama tried to make this distinction (either in a speech
or at one of the debates) but he needs to keep pressing this --
it's PROFIT that's important, not just EARNINGS (before deduction
of expenses).

[tosh]

4. Screaming here too. It needs to be pointed out

to those non-thinkers.

[zbdent]

2. I remember the "small business" that benefited from Bush ...

Wal-Mart, Ford, etc. ... during that "small business tax incentive" of a few years ago ...

[BootinUp]

3. I work for an LLC

That grosses more than 30 mil/year. I have no idea how much profit they made in the last few years. The President is not happy about the prospect of an Obama Presidency. I am no tax expert but if companies like mine do not like the new tax structure I have a feeling they will make whatever changes they need to make in their structure to keep their taxes low.

[Born_A_Truman]

5. One of the talking heads was saying yesterday

that Obama said he "wouldn't raise capital gains taxes on small businesses", but TH said small businesses don't pay capital gains tax.

I think the TH is wrong but he wasn't called on it.
http://www.businessknowledgesource.com/smallbusiness/how_to_handle_capital_gains_tax_if_you_own_a_small_business_024653.html

So much mis-information is out there and being spread about Obama. One woman on a pug forum was worried about her mother losing her property tax transfer (California Prop 60/90, over 55) that Obama would take away. Presidents don't control state property taxes! The GOP is pushing this scary BS to seniors.

[Kurt_and_Hunter]

6. Yes, people tend not to differentiate federal income taxes from all the other taxes

[kestrel91316]

7. Any "small" business that takes home over $250k a year

is not what I call a small business.

[msallied]

8. And I think that R's who attempt to make this point are forgetting...

about McCain's health care plan, which promises to hurt MILLIONS of employees by making them have to pocket the bill for a private insurance policy, or have thousands more in taxable income to account for. That is more worrisome than rolling tax rates back to the prosperous Clinton era.

[ecstatic]

9. I thought the 250k figure was for individuals... are you sure the same

250k amount applies to businesses?

[Tantric]

11. Most mom and pop type businesses

File their businesses as their personal return, so yes. :)

[msallied]

12. Welcome to DU! :)

[flpoljunkie]

10. Only about 1.4% of small business owners make over $250,000. McCain won't tell you that.

[HughBeaumont]

13. But . . . but. . . but. . . wouldn't that destroy the Repuke myth . . .

.. . that businesses are taxed like individuals?

You know that tired canard: "Tax the corporations and it affects all of us. They'll raise their prices to cover their costs!"

Turns out that's full o' horseshit, just like the other meme they tend to spread that more than 50% of the middle class will be affected by the capital gains tax increase. Unless you're a financial baron/day trader, it's not really that big a deal and affects, at best, 8-10% of those making under $112,000/year. Most people invest through 401ks, which are exempt from capital gains taxes.

So how is McCain's "Bushness as Usual" Reagan Redux tax plan to give more lottery money to the wealthy better for America's economy?

Oh wait. It ISN'T.

[Kurt_and_Hunter]

15. There are many sole-proprietorships (but few netting 250K)

[karynnj]

14. Also NO small business of the size you mention

is likely to file via income taxes of the owner.

[NJGeek]

16. I'm a small businessman, and I support Barack Obama

First of all, the healthcare credits make up for much of any tax increase I'd see.

Second, to the OP's point, $250,000 net profit is no small potatoes. That's after salaries to employees folks. That isn't bad. Paying a bit more tax after that amount marginally isn't that big of a deal.

Third, small business people are extremely creative with their account and tax filings. You betcha that most don't show profits of 250,000 or more unless they are truly making a killing. No small business person can cry poverty at 250,000 net profit.

Fourth, and this is to Obama's point in regards to his statements to a small business person today (something to the effect of "your customers will have more money to spend with you"), the tax cuts to the middle class will certainly spur spending and allow many small businesses to grow by driving sales and revenue growth.

[Kurt_and_Hunter]

17. Point three is important and very true

I have had years where I deposited over $300,000 in revenue but had adjusted gross income of $20,000. Many businesses are low-margin.

And all small businesses act to minimize their taxable net. If someone is showing $250,00 that means they're raking in more.