Small business owners in Indiana are urging state lawmakers to preserve key federal tax provisions, including the Small Business Deduction, as the Indiana General Assembly begins its new session. With Congress recently making the Small Business Deduction permanent, projections suggest Indiana could see more than 52,000 new jobs and nearly $2.8 billion added to its gross domestic product over the next ten years.
Lawmakers are expected to consider aligning Indiana’s tax code with these new federal provisions for Tax Year 2025. The Small Business Deduction allows small businesses nationwide to deduct up to 20% of their business income, which has been a priority for members of the National Federation of Independent Business (NFIB).
“Small business owners understand the importance of conforming Indiana’s tax code with the new federal provisions, but not at the expense of Main Street,” said NFIB Indiana State Director Natalie Robinson. “It is crucial that the General Assembly allows Indiana’s small businesses to take full advantage of the Small Business Deduction and the other beneficial tax provisions that will allow Indiana’s Main Street to thrive.”
Randy Ballinger, owner of Walnut Creek Golf Courses in Marion, stated: “The 20% tax break for small businesses will help our children continue to operate and invest in our 36-hole operation in a positive financial way to keep our family business to transfer from generation to generation and continue to help Grant County financially.”
In addition, recent changes in federal law allow all research and development expenses incurred after December 31, 2024, to be deducted immediately. This means small businesses can write off domestic research or experimental costs right away rather than spreading them out over time.
Mike Sponseller, owner of Precision Fabrication Inc., commented: “The R&D tax credits Congress passed this summer are a huge win for small businesses. Thank you to Senator Jim Banks and Senator Todd Young for working to make it retroactive for Indiana’s small businesses.”
NFIB has indicated it will remain active throughout the legislative session as decisions about conformity are made. The organization plans to update its members regularly and seek their input as lawmakers debate these issues.
NFIB has also initiated several advocacy campaigns encouraging Congress to make the Small Business Deduction permanent.
