The Republican argument against allowing the Bush tax cuts to expire for tax payers making more than 250k/year is that raising taxes on this income bracket would kill off small businesses or at least slow their growth/recovery. They say this as if it is self evident but it raises a number of questions for me that I'd like to hear the opinions of some tax experts about (like maybe LTG or Seventh Sister).
First, are all small business profits treated as income for the owner for tax purposes?
Second, is there a way for a small business owner to reinvest their profits in their business before it can be taxed as income?
Finally, depending on the answers to the first two questions, shouldn't it be fairly straightforward to prevent what is intended to be a tax increase on the richest portion of the population from directly affecting small businesses in general?
Or is this just a typical Republican canard based on dishonest presentations of the facts?