# What does Obama mean when he says Donald Trump is a small business? **URL:** \ **Category:** Politics & Elections\ **Created:** [October 4, 2012, 1:29am UTC](https://boards.straightdope.com/t/what-does-obama-mean-when-he-says-donald-trump-is-a-small-business/636651 "2012-10-04T01:29:22Z")\ **Posts on this page:** 13\ **Page:** 1
**Author:** ![newcrasher](https://avatars.discourse-cdn.com/v4/letter/n/b3f665/32.png) [@newcrasher](https://boards.straightdope.com/u/newcrasher)\ **Post date:** [October 4, 2012, 1:29am UTC](https://boards.straightdope.com/t/what-does-obama-mean-when-he-says-donald-trump-is-a-small-business/636651/1 "2012-10-04T01:29:22Z")
Obama said under Romney’s plan, Trump is a small business. What is he referring to? ---
**Author:** ![Sateryn76](https://avatars.discourse-cdn.com/v4/letter/s/a88e4f/32.png) [@Sateryn76](https://boards.straightdope.com/u/Sateryn76)\ **Post date:** [October 4, 2012, 1:39am UTC](https://boards.straightdope.com/t/what-does-obama-mean-when-he-says-donald-trump-is-a-small-business/636651/2 "2012-10-04T01:39:46Z")
I have no idea. The thought that Trump would be declaring his business income as a sole proprietor on a Schedule C is ridiculous. Maybe I missed something, but no successful anything would pay such a high rate if incorporation is a option. ---
**Author:** ![Folacin](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/folacin/32/3195_2.png) [@Folacin](https://boards.straightdope.com/u/Folacin)\ **Post date:** [October 4, 2012, 1:45am UTC](https://boards.straightdope.com/t/what-does-obama-mean-when-he-says-donald-trump-is-a-small-business/636651/3 "2012-10-04T01:45:57Z")
Could be incorporated as an[S corporation](http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/S-Corporations). My understanding is that a lot of wealthy persons move their income through that structure to reduce taxes. ---
**Author:** ![JohnT](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/johnt/32/15048_2.png) [@JohnT](https://boards.straightdope.com/u/JohnT)\ **Post date:** [October 4, 2012, 1:51am UTC](https://boards.straightdope.com/t/what-does-obama-mean-when-he-says-donald-trump-is-a-small-business/636651/4 "2012-10-04T01:51:21Z")
I think it was sarcasm that fell flat… Romney’s talking about “tax cuts for small businesses”, Obama tried to make a joke about Romney offering tax cuts for the wealthy by saying that Trump is a small business. I think… ---
**Author:** ![ladyfoxfyre](https://avatars.discourse-cdn.com/v4/letter/l/ad7895/32.png) [@ladyfoxfyre](https://boards.straightdope.com/u/ladyfoxfyre)\ **Post date:** [October 4, 2012, 1:53am UTC](https://boards.straightdope.com/t/what-does-obama-mean-when-he-says-donald-trump-is-a-small-business/636651/5 "2012-10-04T01:53:27Z")
My guess was S corp. It avoids double taxation at the corporate level and the personal income level, and I think the “small business” name has to do with the number of owners. ---
**Author:** ![Enkel](https://avatars.discourse-cdn.com/v4/letter/e/df705f/32.png) [@Enkel](https://boards.straightdope.com/u/Enkel)\ **Post date:** [October 4, 2012, 2:14am UTC](https://boards.straightdope.com/t/what-does-obama-mean-when-he-says-donald-trump-is-a-small-business/636651/6 "2012-10-04T02:14:54Z")
He employes fewer than 500 people, so he’s a small business. One way to keep that status is to contract most of your work instead of hiring people. Contractors can also be dumped without incurring any costs (unemployment insurance, having to make public lay off notices, etc) ---
**Author:** ![Jonathan\_Chance](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/jonathan_chance/32/701_2.png) [@Jonathan\_Chance](https://boards.straightdope.com/u/Jonathan_Chance)\ **Post date:** [October 4, 2012, 2:50am UTC](https://boards.straightdope.com/t/what-does-obama-mean-when-he-says-donald-trump-is-a-small-business/636651/7 "2012-10-04T02:50:55Z")
Yep. One of the definitions for small business set-asides is employing fewer than 250 people. ---
**Author:** ![Lord\_Feldon](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/lord_feldon/32/341_2.png) [@Lord\_Feldon](https://boards.straightdope.com/u/Lord_Feldon)\ **Post date:** [October 4, 2012, 3:23am UTC](https://boards.straightdope.com/t/what-does-obama-mean-when-he-says-donald-trump-is-a-small-business/636651/8 "2012-10-04T03:23:23Z")
There is no fixed definition of “small business,” so in politics it expands and contracts as the speaker wishes. ---
**Author:** ![Eugene\_of\_Sandwich](https://avatars.discourse-cdn.com/v4/letter/e/c37758/32.png) [@Eugene\_of\_Sandwich](https://boards.straightdope.com/u/Eugene_of_Sandwich)\ **Post date:** [October 4, 2012, 3:09pm UTC](https://boards.straightdope.com/t/what-does-obama-mean-when-he-says-donald-trump-is-a-small-business/636651/9 "2012-10-04T15:09:43Z")
That was a huge stretch that just sort of sailed right over everybody’s heads. I figured he might have been grasping at the number of employees technicality. Trump is small potatoes…yeah, right. ---
**Author:** ![elucidator](https://avatars.discourse-cdn.com/v4/letter/e/8edcca/32.png) [@elucidator](https://boards.straightdope.com/u/elucidator)\ **Post date:** [October 4, 2012, 3:16pm UTC](https://boards.straightdope.com/t/what-does-obama-mean-when-he-says-donald-trump-is-a-small-business/636651/10 "2012-10-04T15:16:13Z")
[http://tpmdc.talkingpointsmemo.com/2010/09/gop-bechtel-pricewaterhousecoopers-and-other-small-businesses-will-see-tax-hike-charts.php](http://tpmdc.talkingpointsmemo.com/2010/09/gop-bechtel-pricewaterhousecoopers-and-other-small-businesses-will-see-tax-hike-charts.php) A rather good brief exposition on the problems with terminology, i.e., “small” business. Examples of “small businesses”: Bechtel, Price Waterhouse Coopers. They are small businesses in much the same way that Godzilla is a gecko. ---
**Author:** ![Chefguy](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/chefguy/32/138_2.png) [@Chefguy](https://boards.straightdope.com/u/Chefguy)\ **Post date:** [October 4, 2012, 3:37pm UTC](https://boards.straightdope.com/t/what-does-obama-mean-when-he-says-donald-trump-is-a-small-business/636651/11 "2012-10-04T15:37:24Z")
> [@Jonathan\_Chance](#): > > Yep. > > One of the definitions for small business set-asides is employing fewer than 250 people. Corporations get past that by creating spin-off subsidiaries that apply for SBA status, and who sub out work as well. Even though they’re not supposed to have access to the mother company’s resources, nobody abides by that rule. ---
**Author:** ![Enkel](https://avatars.discourse-cdn.com/v4/letter/e/df705f/32.png) [@Enkel](https://boards.straightdope.com/u/Enkel)\ **Post date:** [October 4, 2012, 5:18pm UTC](https://boards.straightdope.com/t/what-does-obama-mean-when-he-says-donald-trump-is-a-small-business/636651/12 "2012-10-04T17:18:15Z")
> [@Lord\_Feldon](#): > > There is no fixed definition of “small business,” so in politics it expands and contracts as the speaker wishes. SBA Small Business Size definitions, how they’re assigned and the actual size according the the type of business (paragraph 121.201) [http://ecfr.gpoaccess.gov/cgi/t/text/text-idx?c=ecfr&sid=17a8b75b6d39a91bd4e087a6f4339059&rgn=div5&view=text&node=13:1.0.1.1.17&idno=13\>)#13:1.0.1.1.17.1.268.9](http://ecfr.gpoaccess.gov/cgi/t/text/text-idx?c=ecfr&sid=17a8b75b6d39a91bd4e087a6f4339059&rgn=div5&view=text&node=13:1.0.1.1.17&idno=13%3E%29#13:1.0.1.1.17.1.268.9) ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [October 4, 2012, 5:55pm UTC](https://boards.straightdope.com/t/what-does-obama-mean-when-he-says-donald-trump-is-a-small-business/636651/13 "2012-10-04T17:55:01Z")
They are talking about any business that does not pay a corporate level tax. This includes partnerships, LLCs, S Corps, etc. A lot of Donald’s income is partnership icnome. No entitiy level tax.