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Governor signs small business federal tax savings bill into law

By Brandon Smith

Posted February 23, 2023

state that works

The first bill signed into law in 2023 is a measure meant to save Indiana small businesses money on their federal taxes. (Justin Hicks/IPB News)

Hoosier small businesses can get greater federal tax savings this year because of the first bill from the 2023 session that’s been signed into law.

The measure signed Wednesday, SB 2, allows small business owners who file individual income taxes (not corporate income taxes) to fully deduct their state tax payments from their federal taxes.

Previously, those deductions were capped at $10,000.

READ MORE: Bill to save small businesses millions in federal taxes heads to governor's desk

Join the conversation and sign up for the Indiana Two-Way. Text "Indiana" to 73224. Your comments and questions in response to our weekly text help us find the answers you need on statewide issues throughout the legislative session. And follow along with our bill tracker.

Proponents of the bill say it could save about 500,000 businesses in Indiana more than $100 million.

Brandon is our Statehouse bureau chief. Contact him at bsmith@ipbs.org or follow him on Twitter at @brandonjsmith5.

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