I understand that a small business making $250,00/year sounds like it’s doing well. I would agree one guy making $250,000/year is pretty well off. However, it seems many here are assuming these businesses are one owner businesses. I don’t think that is an assumption one should make.
I have been involved in a number of small businesses, all of mine involved multiple party ownership. And I think that isn’t very unusual. Many times five or more people had stakes in the businesses I co-owned.
So a small business, if incorporated, as many are, making over $250,000/year would be hit with this tax increase on the “wealthy”, as an entity, reducing the amount passed through to the owners.
For example, a business hit hard due to the economic situation,(let’s say it was making $500,000/yr for 5 owners but now is making only $300,000) will now be nicked again due this tax on the “wealthy”.
I don’t know if I’d consider these five guys “wealthy” even wen sharing $500,000.
So I won’t be surprised if this tax on the “wealthy” results in some layoffs an/or salary cuts.
