What the Senate Tax Plan Means for Small Business

The Senate passed its version of the tax reform bill on Friday by a 51-49 vote, with a flurry of last-minute amendments to the original Senate proposal in order to keep Republican holdouts from voting against the measure. With the vote, lawmakers from the Senate and the House will now confer to try to iron out differences between the two versions of tax reform and seek a compromise that both chambers can pass.

One important aspect of the tax reform measures that many people have focused on is their impact on small businesses. Although the provision that reduces maximum corporate tax rates from 35% to 20% has gotten the most attention from investors, many lawmakers have worried that those moves would have minimal effect on smaller companies that they see as the hope for spurring economic growth in the years to come. The Senate bill differs from the House's proposal in the way that it treats small businesses, and there will be some work to do before the two chambers can come to agreement on what small businesses will end up getting in the final version.

U.S. Capitol. Image source: Getty Images.

Source: Fool.com