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S3459119th CongressWALLET

Support Small Business Growth Act of 2025

Sponsored By: Senator Ossoff, Jon [D-GA]

Introduced

Summary

Creates a time-limited payroll tax deduction that rewards small employers who designate their lowest-paid full-time workers. This new Section 177 would let eligible small businesses claim an extra payroll deduction per designated employee in addition to ordinary business deductions.

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  • Small businesses with no more than 15 full-time employees that meet the gross receipts test could qualify. Employers must certify they meet these limits.
  • Employers designate the lowest-paid full-time workers and must exclude highly compensated employees. For each designated worker the deduction equals the lesser of 12% of wages or a wage cap that starts at $8,000.
  • The deduction applies to tax years beginning in 2026 and the allowed number of designated employees phases down to zero by 2033.

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Bill Overview

Analyzed Economic Effects

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

Payroll tax break for small businesses

If enacted, qualified small businesses would be able to claim a new payroll-related tax deduction on top of their regular business deduction. To qualify, a business must have 15 or fewer full-time employees at year end, meet the gross receipts test, and certify this to the IRS. The employer would pick a limited number of its lowest-paid full-time workers, excluding highly compensated workers. For each picked worker, the deduction would equal the lesser of 12% of that worker's wages or a per-worker cap. The number of picked workers phases down by year: 10 for tax years beginning 2026–2030; 8 for 2031; 6 for 2032; 4 for 2033; and 0 after 2033. The caps are tiered: most slots get $8,000 each, one extra slot can get $6,000, and one extra slot can get $4,000. The rule would apply to tax years beginning after December 31, 2025.

Sponsors & CoSponsors

Sponsor

Ossoff, Jon [D-GA]

GA • D

Cosponsors

  • Sen. Hyde-Smith, Cindy [R-MS]

    MS • R

    Sponsored 12/11/2025

Roll Call Votes

No roll call votes available for this bill.

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