As Donald Trump returns to the White House, small business owners across the country are left wondering: What will the next four years hold for us? With nearly 40 million small businesses in the U.S. and an expected 10 million more likely to start over the next four years, Trump’s policies are poised to have a significant impact on our entrepreneurial landscape.
In this post, we break down three major areas to keep an eye on during Trump’s presidency set to begin in January 2025. Whether you’re just starting out or managing a business that’s already generating millions in revenue, here’s what these changes could mean for you.
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Federal Small Business Programs: Grants, Loans, and the SBA
One of the most pressing questions for small business owners is what will happen to federal programs that support entrepreneurship – from grants and loans to the Small Business Administration (SBA) itself.
Under Trump’s previous administration, we saw a strong focus on deregulation, corporate tax cuts, and stimulus packages aimed at keeping businesses afloat. But what might we expect this time around?
A New SBA Administrator
It’s likely that Trump will appoint a new SBA Administrator, someone who aligns with his business-focused approach. Under Trump’s influence, the SBA may shift towards greater reliance on private banks for lending, potentially reducing the focus on SBA-backed loans. In Trump’s first term, there was an emphasis on partnerships with big banks over direct federal funding, so this trend may continue.
Grant Programs and EIDL Forgiveness
During Trump’s presidency, direct grant programs weren’t a high priority, but with sectors still feeling the impact of recent economic challenges, there’s potential for targeted grants, particularly in sectors that have been hit hard by inflation and supply chain disruptions. However, when it comes to EIDL (Economic Injury Disaster Loan) forgiveness, expectations are cautious. Trump has historically favored repayment over loan forgiveness, though he may allow more deferment options or restructuring for businesses struggling to recover.
Starting Out as a New Entrepreneur
For new entrepreneurs just launching their businesses, Trump’s policies could bring some promising changes, particularly around lowering costs and simplifying requirements to start a business.
Lower Startup Costs and Deregulation
Trump’s administration previously rolled back regulations in a bid to reduce the administrative burden on small businesses, a trend that’s likely to continue. For those just starting out, fewer regulatory requirements could mean a faster, less expensive path to officially launching a business. Whether you’re establishing an LLC, corporation, or a gig-based business, you may encounter fewer regulatory hoops to jump through, reducing costs on things like legal fees and permitting.
Simplified Tax Filing Process
We may also see a further simplification of the tax filing process for small businesses. Trump has previously championed streamlined tax brackets and increased deductions, and a similar approach could emerge, allowing new business owners to keep more of their hard-earned revenue. While we don’t know exactly how the tax code may change, the emphasis is likely to be on simplifying the system and cutting down on complicated filing requirements.
Growing Businesses Generating Millions in Revenue
If you’re an established business owner with a company that’s already scaling up, Trump’s policies could provide benefits through tax cuts, though trade policies might present some challenges.
Corporate Tax Cuts
One of Trump’s key policies during his previous term was lowering the corporate tax rate, and this trend is likely to continue. Trump has advocated for reducing the corporate tax rate further, from the current 21% down to as low as 15%. For businesses structured as C-corporations, this cut could free up more capital to reinvest in growth, hiring, or expansion.
Trade Policies and Tariffs
For businesses relying on imported goods, Trump’s ‘America First’ trade policy could pose challenges. Trump has proposed imposing tariffs on imports, especially from China. For small businesses in industries like retail or manufacturing, this could lead to higher prices for imported goods, affecting profit margins. However, businesses that focus on domestic production might find themselves in a more competitive position, as foreign competition becomes more expensive in the U.S. market.
Final Thoughts: A Changing Landscape for U.S. Small Businesses
So, what does all this mean for the future of small businesses in America? Trump’s policies will likely create a supportive environment for small business owners who can benefit from lower taxes and reduced regulations. However, there will be trade-offs – especially for those who rely on federal grants, SBA loans, or international supply chains.
Here are a few key takeaways:
- If you’re just starting out: Expect simplified regulations and possibly some tax benefits that reduce your initial startup costs.
- For established businesses: Look out for potential tax breaks and prepare for possible trade challenges, especially if you rely on imports.
- For all small business owners: Staying informed will be key. Trump’s policies are likely to evolve, so keeping up with the latest developments will help you adapt to new opportunities and navigate potential obstacles.
Stay Informed and Proactive
While 2025 will bring more clarity to what might happen, Trump's track record suggests a focus on tax cuts and deregulation. Whether or not these changes will benefit your business depends on factors like your business structure, industry, and growth stage.
For entrepreneurs and small business owners, staying proactive and informed is essential. By understanding these changes and anticipating how they might impact your business, you’ll be better prepared to take advantage of the opportunities and tackle the challenges that come your way.
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