Mid-Year Small Business News and Potential Government legistlation

Mid-Year Small Business News

Bill to Increase 20% flow-through deduction to 23%

A bill to increase the small business flow-through deduction to 23% has been introduced in the House, the Small Business Tax Cut Act (H.R.8415). This increase would apply to small business owners operating as sole proprietorships, S-corporations, partnerships, LLCs, and would help the small business owner keep more profits to reinvest in the business.

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Small Business Beneficial Owner Filing Requirement is officially OVER.

You may recall that several years ago Congress created quite the stir by requiring small businesses to report personal information on small business owners and included severe penalties for non-compliance. There is good news. That requirement was suspended at the beginning of the Trump administration's second term and was recently invalidated in its entirety.

The U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) issued a final rule, effective August 14, 2026, that permanently removes the requirement for U.S. companies and U.S. persons to report beneficial ownership information to FinCEN under the Corporate Transparency Act.

FinCEN also announced that it will delete previously reported information by U.S. persons from the beneficial ownership information database. Under the final rule, foreign entities that are reporting companies will still be required to report beneficial ownership information for foreign individuals.  

Mid-Year IRS Gas Mileage Allowance Increase

The IRS recently announced an increase to the IRS standard mileage rate for business use to 76 cents per mile, effective July 1, 2026. This represents a 4.8% increase from the 72.5 cents-per-mile rate that took effect on Jan. 1, 2026, and went through June 30, 2026.

Update on Trump Accounts for Kids

We now have further guidance on implementing these child savings accounts, some of which are funded by government seed money.

Rules for Older Children:   Trump Accounts can be used for any child under age 18, but no $1,000 seed funding for those born outside the dates mentioned above.

• Annual limit of $5,000 contributions to Trump Account by parents, grandparents, guardians, etc. No contributions after age 18.

• All contributions are pre-tax. No tax deduction for the contribution.

• Earnings generated by the investments in the Trump Account are tax-deferred.

• Converts to a traditional IRA after age 18 with traditional IRA rules on early withdrawals

How to implement Trump Account?

File IRS Form 4547 or use the app at trumpaccounts.gov