By MICHELE F. MIHALJEVICH

Indiana Correspondent

WASHINGTON, D.C. — A U.S. House member from Iowa is hoping to restore the 15 percent tax bracket for farmers and other small family entities with adjusted gross incomes of up to $50,000 doing business as C corporations.

The Tax Cuts and Jobs Act (TCJA), signed into law by President Donald Trump on Dec. 22, 2017, raised the tax bracket for those entities to 21 percent. The difference could mean a maximum tax increase of $3,000 annually, said Iowa Republican Rep. Steve King.

“I think it’s a humane thing to do to the smaller operations,” he explained. “They’re in the category with I suppose thousands of other Americans that are going to have an adjusted gross income of less than $50,000 that saw their taxes actually go up because of H.R. 1 (TCJA).

“It’s kind of a bitter pill to swallow when you’re a small operation doing things right and you’re watching a big tax cut bill come along.”

King introduced his bill – House Resolution 7176 – in late November. It was referred to the House Ways and Means Committee. The legislation seeks to amend the Internal Revenue Code of 1986.

Taxable income in excess of $50,000 would be taxed at 21 percent. The change would take effect for taxable years after Dec. 31, 2017.

The bill wouldn’t impact farms that aren’t doing business as C corporations, noted Michael Langemeier, a Purdue University professor of agricultural economics.

“It is a very real issue and does impact those organized as C corporations,” he explained. “The legislation is trying to fix (the law) to make lower rates available again. Before the tax bracket was changed to 21 percent, a lot of farms were in the lower bracket.”