Very good point which I should have realized, being self-employed. It depends on what the tax code says about payroll taxes and whether they are a deductible business expense. I’m not a tax lawyer, but my guess is that if you are a sole proprietor, you get screwed with no deduction. But if you incorporate, the “corporation” (which is you) gets to take the corporate payroll deduction.
But it would appear to have the potential of penalizing the self-employed. Right now the Federal government gives the self-employed a number of benefits. For example, I get to deduct the employer’s contribution to social security off my personal income. I also take can take a business deduction for my health insurance premiums (which are staggeringly high to begin with).
States, not so friendly.
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