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Under both the House and Senate versions of the Tax Reform Bill presented last week in Washington, one thing is clear: Businesses organized as pass-through entities are going to see their taxes increase. The S Corp Washington Wire lays out all the ways in which pass-through entities are hurt by this proposed tax bill.
There is a provision in the Senate version which would repeal the IC-DISC export incentive. Not only is this bad policy, this will cause a significant increase in the tax burden of U.S. based exporters.
What Should You Do?
Now is the time to reach out to your U.S. Senator and your Congressman and let them know that the provisions in this bill will increase your taxes! Emphasize that the IC-DISC is an export incentive – not a base erosion and profit shifting provision. This incentive allows you to export your U.S. manufactured goods by allowing you to be more competitive. This further allows you to make investments in your U.S. based business and to hire more U.S. employees. Also, let them know what industry you are in, if compelling, how many employees in your company, and finally what actions you may be forced to take if you were to experience a large tax increase due to the repeal of the IC-DISC. Maybe you would consider hiring less employees, reducing the number of your current employees, or possibly even looking at moving manufacturing outside the U.S. to a lower cost location.
A form letter will be disregarded and therefore we have been advised not to provide our clients with any form letters. We encourage you to draft your own letter on your own letterhead. However, to give you a starting point, we have attached a couple of letter templates – the first is a letter to the Senate Finance Committee and the second would be a letter for your specific Senator.
We have also prepared an IC-DISC Position Paper and have provided this to a number of staffers in Washington. It has been suggested that you attach this position paper to your letter when you send it in.
Below is a list of the Senate Finance Committee Republicans and their Key Staff Members: Here is how you can help:
1. Call the Senators’ Offices (see list below) advocating for the removal of the IC-DISC repeal inclusion in Tax Reform and why it is important to your company
2. Edit and then Email the draft letter to the Senators’ Key Staffers on Tax
3. Last but not least, if your company resides or does business in another Senators’ district please send the letter and our position paper to your Senators’ contact form.
Additionally, please see this full list of all U.S. Senators and their contact information.