Press Releases

Congresswoman Gwen Moore Introduces Mom and Pop Tax Relief Act

Congresswoman Moore, a member of the Ways and Means Committee, introduced legislation, H.R. 3249, to provide key reforms to the 199A Qualified Business Income (QBI) deduction to ensure that small businesses can truly benefit from this tax relief and reign in massive giveaways to wealthy shareholders.

“Small businesses are the backbone of our economy but are feeling tremendous pressure in Trump’s economy, especially as they work with a tax code that favors wealthy businesses. Section 199A is a prime example of how Republicans’ Tax Cuts and Jobs Act became a giveaway for the wealthiest Americans. Right now, this provision is working against our smallest businesses while rich individuals and high-grossing companies can exploit loopholes to further enrich themselves. If Republicans were truly serious about helping Main Street, they would support my legislation to ensure that mom and pop businesses can feel meaningful relief from the Section 199A deduction,” said Congresswoman Moore.

“Small businesses today are grappling with crippling uncertainty, due mainly to tariffs and the rollback of federal resources that support small firms,” said Small Business Majority Founder & CEO John Arensmeyer. “Now more than ever lawmakers must focus on offering benefits to the most vulnerable small businesses, and updating Section 199A in a way that helps the overwhelming majority of Main Street firms is one of the best ways to do that. We applaud Rep. Moore for her commitment to revising our tax code in order to deliver real results for most small businesses.”

"When the Tax Cuts and Jobs Act passed in 2017 during the first Trump Administration, the Main Street Alliance fought to make the U.S. Tax Code more equitable,” said Main Street Alliance Executive Director Richard Trent. “Unfortunately, policy makers at the time prioritized large corporations and the wealthy over entrepreneurs and growing businesses. Now is the time to correct course and better target tax relief to businesses who are just getting started, and trying to grow."

Background 

The TCJA created the Section 199A deduction, which allows businesses to deduct 20 percent of their pass-through income from their federal income taxes. While Republicans tout this deduction to help Main Street, it disproportionately benefits the wealthy. The Joint Committee on Taxation estimates that more than half of the tax benefits of Section 199A continue to benefit millionaires. Meanwhile, the average small business with less than $100,000 of gross income receives a tax break of less than $2,000.

The Mom and Pop Tax Relief Act would allow businesses to deduct $25,000 of their QBI, giving small businesses with lower revenues an advantage. This deduction would phase out at $200,000 of QBI for single filers and $400,000 of QBI income for joint fillers, providing targeted tax relief to small businesses.