PIA: Independent Insurance Agents Score Major Victory In Treasury Department’s Proposed Regulations for Pass-Through Businesses

Insurance Weekly News

By a News Reporter-Staff News Editor at Insurance Weekly News -- In a major win for small-business insurance agencies and brokerages, proposed regulations issued August 8 by the U.S. Treasury and the Internal Revenue Service (IRS) specifically state that insurance agents and brokers are not excluded from taking the 20% pass-through tax deduction that was passed as part of the tax reform legislation signed into law late last year.

Many members of the National Association of Professional Insurance Agents (PIA) own independent insurance agencies that are organized as sole proprietorships, partnerships, or Subchapter S corporations. Such small businesses do not pay corporate income tax. Instead, their income "passes through" the firm and appears directly on their owners' individual tax returns, where it is taxed as normal income. The 20% deduction, subject to other limitations imposed by law or regulation, will lower these individuals' tax bills.

Treasury's proposed regulations explicitly specify that insurance agents and brokers are not barred from taking the deduction, unlike others, like stock brokers, for example.

"PIA has been aggressively advocating for this tax relief for pass-through entities since passage of the tax reform law (P.L. 115-141) last December, on behalf of PIA members," said PIA National Executive Vice President & CEO Mike Becker. "We advocated for the language that was ultimately adopted by Treasury and the IRS in their proposal."

"PIA was gratified to see the proposed Treasury regulation explicitly excludes insurance agents and brokers from the category of businesses that are not permitted to take the 20% pass-through deduction," said Lauren G. Pachman, Esq., PIA counsel and director of regulatory affairs. "It's a good day for small-business insurance agencies, whose businesses will be taxed the way pass-through entities were intended to be by Congress."

Founded in 1931, PIA is a national trade association that represents member insurance agents and their employees who sell and service all kinds of insurance, but specialize in coverage of automobiles, homes and businesses. PIA members are Local Agents Serving Main Street America SM. PIA's web address is www.pianet.com

This statement is online at: http://www.pianet.com/news/press-releases/2018/independentinsuranceagentsscoremajorvictoryinpropsedregulationsforpassthrough080918

SOURCE National Association of Professional Insurance Agents

Keywords for this news article include: Insurance Companies, National Association of Professional Insurance Agents.