Lana Pol's small businesses are enjoying big savings under the new tax law — at least for now.
The entrepreneur runs four small companies across Iowa, including Mowbility Sales & Service, which sells agricultural equipment, and Geetings Inc., a trucking and warehousing business. Pol said she saw a drop in her overall tax burden this year thanks to the qualified business deduction, a change made to the individual tax code, available for pass-through entities. Her savings look substantial.
"We're estimating around up to $40,000," Pol said. "By utilizing that, we gave our employees raises, knowing that was going to help us for taxes this year."
Pol said she also utilized Section 179 expensing to write off a major purchase of new semitrailers — six in all, totaling $1 million. Taxes were often a top issue prior to reform, she said.
And Pol's not alone. Taxes have long been a sore spot for small businesses, which is one of the reasons optimism soared as President Donald Trump took office and began the process of overhauling the law.
But now, in the midst of the first tax season since the law went effect, Main Street advocates are cheering parts of the overhaul but are also arguing that the law didn't go far enough. Tax breaks enacted to help small businesses aren't permanent, and that's made it difficult for business owners to make long-term decisions. Some would like to see Congress move to make temporary tax breaks permanent.
To be sure, temporary or not, the tax breaks have been a boon for small businesses. The National Federation of Independent Business said at least 10 percent of small business owners have ranked taxes as their most important problem nearly every month since 1973 when the group began polling Main Street.