December 1933

21st Amendment Ratified, Prohibition Ended

 

December 5, 2017 marks 84 years since the United States ratified the 21st Amendment to the U.S. Constitution and paved the way for the modern three-tier beverage alcohol system.

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Federal Key Issue - Pass Through Entity Taxation

Any tax reform effort must be comprehensive in nature – taking into account changes to both personal and corporate tax rates. In recent years, there have been attempts to force most pass through entities – S corporations, partnerships, limited liability corporations, etc. – to become C corporations.

Former Ways & Means Committee Chairman Dave Camp’s discussion draft dramatically increases the way in which some pass through entities are taxed. The proposal alters the tax formula for S Corporations by imposing payroll taxes on investment income. The so-called “70/30” rule treats all income the same whether it is invested business capital or shareholder wages. This change from current law would force WSWA members structured as S Corps to pay taxes in excess of the 35% rate cap for those filing as individuals.

WSWA believes that any tax reform legislation must take into account S Corporations, partnerships, limited liability corporations, and sole proprietorships as well as C corporation rates. Any tax reform legislation must not lower the corporate rate at the expense of American family-owned businesses.