Alabama Law Scholarly Commons Articles Faculty Scholarship 2008 When American Small Business Hot the Jackpot: Taxes, Politics and the History of Organizational Choice in the 1950's Mirit Eyal-Cohen University of Alabama - School of Law,
[email protected] Follow this and additional works at: https://scholarship.law.ua.edu/fac_articles Recommended Citation Mirit Eyal-Cohen, When American Small Business Hot the Jackpot: Taxes, Politics and the History of Organizational Choice in the 1950's, 6 Pitt. Tax Rev. 1 (2008). Available at: https://scholarship.law.ua.edu/fac_articles/110 This Article is brought to you for free and open access by the Faculty Scholarship at Alabama Law Scholarly Commons. It has been accepted for inclusion in Articles by an authorized administrator of Alabama Law Scholarly Commons. ARTICLES WHEN AMERICAN SMALL BUSINESS HIT THE JACKPOT: TAXES, POLITICS AND THE HISTORY OF ORGANIZATIONAL CHOICE IN THE 1950s Mirit Eyal-Cohen* When I came to study the income tax problems of the small business man, I had a feeling I had looked at all the ills and diseases of the tax law. -Charles T. Akre, Nebraska Tax Institute, 19431 INTRODUCTION While many political developments affected American small businesses during the twentieth century, the enactment of Subchapter S of the Internal Revenue Code (Code) was of particular significance.2 Under Subchapter S, a small business corporation could elect to be treated as a partnership and have its shareholders taxed at the end of each year on their tax return in a pass- through manner.3 The elimination of double taxation for the small business * S.J.D.