PRIA Logo™
119-hr-652119th CongressWALLET

Small Business Investor Tax Parity Act of 2025

Sponsored By: Representative Arrington, Jodey C. [R-TX-19]

Introduced

Summary

Would extend the section 199A qualified business income deduction to certain dividends from electing business development companies (BDCs). It would create a new "qualified BDC interest dividend" category so those dividends can be claimed like qualified REIT dividends for the 199A deduction, applying to tax years beginning after December 31, 2026.

Show full summary
  • Investors and households: Individual taxpayers who receive eligible BDC interest dividends could use the 199A deduction to reduce taxable income on those dividends, lowering after-tax returns for holders of qualifying BDC shares.
  • Electing BDCs and managers: BDCs that elect to be treated as regulated investment companies (RICs) would have net interest income that is properly allocable to a qualified trade or business pass through as deductible dividends when distributed.
  • Timing and scope: The change targets dividends attributable to a BDC's net interest income and would take effect for tax years starting after December 31, 2026.

Personalized for You

How does this bill affect your finances?

Personalize government policy and PRIA will tell you what this bill means for your household, plus every other piece of legislation we track. PRIA reads each provision against your financial profile to show you exactly what matters to your wallet.

Free to download

Bill Overview

Analyzed Economic Effects

1 provisions identified: 1 benefits, 0 costs, 0 mixed.

Tax break for investors in business development companies

If enacted, you could claim the section 199A business income deduction on certain dividends from business development companies. The dividend would need to be a qualified BDC interest dividend. It must come from a business development company that elected to be treated as a regulated investment company, and be from its net interest income tied to a qualified trade or business. This would apply to tax years beginning after December 31, 2026.

Sponsors & CoSponsors

Sponsor

Arrington, Jodey C. [R-TX-19]

TX • R

Cosponsors

  • Rep. Tenney, Claudia [R-NY-24]

    NY • R

    Sponsored 3/6/2025

  • Rep. Boyle, Brendan F. [D-PA-2]

    PA • D

    Sponsored 4/27/2026

  • Rep. Davis, Danny K. [D-IL-7]

    IL • D

    Sponsored 5/12/2026

  • Rep. Moore, Gwen [D-WI-4]

    WI • D

    Sponsored 7/9/2026

Roll Call Votes

No roll call votes available for this bill.

View on Congress.gov
Back to Legislation