Survey Shows Tax Savings Go to Build Business, Pay Employees First
— Family-owned businesses have a long, well-documented track record of reinvesting profits back into their companies rather than distributing them to owners, and a new survey shows that pattern holds true when it comes to tax savings, too:
In the survey, from Family Enterprise USA (FEUSA), leaders of family-owned business say that when their taxes are reduced the benefits will go directly back into their businesses and into paying their employees more.
When leaders of family-owned businesses were asked, “If you paid less taxes, what would you do with the savings?”, 63% said they would “invest more into my business.”
The finding is from the 2026 Annual Family-Owned Business Survey by Family Enterprise USA are based on a survey among 710 family-owned business respondents from 46 states.
Family-owned businesses contribute $7.7 trillion annually to the U.S. economy and support 83.3 million jobs, according to research.
The survey also found 25% of family-owned businesses would “pay my employees” more, while only 6% said they would “make distributions to owners.”
These findings reconfirm a pattern other independent researchers have documented for years, that family-owned businesses consistently choose to reinvest in their companies rather than pull cash out for owners.
For example, PwC’s 2025 Global Family Business Survey, conducted with the John L. Ward Center for Family Enterprises at Northwestern University’s Kellogg School of Management, found that 85% of family businesses fund innovation and growth by reinvesting profits, relying on internal capital ahead of outside financing such as bank loans or private equity.
Another study by McKinsey & Company similarly found family-owned businesses tend to pay out lower dividends and reinvest more of their profits than non-family firms, a discipline that keeps ownership in family hands while fueling long-term growth.
FEUSA’s survey shows that same instinct at work among family-owned businesses, that given the chance to keep more of their own money through lower taxes, the overwhelming majority say they would invest it back into the business and its workforce, not into higher payouts to owners.
Top Tax Policies
The FEUSA survey, which covered a wide range of topics, from top tax and economic concerns to cyber-security issues to ownership issues, also found family-owned businesses have three top tax worries.
It found the “Top 3 Tax Policies” most important to family-owned business owners were income taxes, estate taxes, and the growing concern over Wealth Taxes, or savings penalty taxes.
The survey found that 56% of the leaders of family-owned business saw income taxes as their main concern, up for 47% in 2025 survey.
The second biggest tax priority were estate taxes, where 21% said these were most important, up from 19% in 2025.
The fastest growing priority, or concern, were Wealth Taxes, which saw the biggest jump, to 10% this year versus only 5% in 2025.
“Family-owned businesses are the number one job creators in our country,” said Pat Soldano, President, Family Enterprise USA, survey organizers. “Yet they have challenges larger, traditional corporations never face, such as paying higher taxes and the threat of large Estate Taxes,” she said. “But this research shows that any reduction in taxes will mostly go directly back into the business or to employees,” she said. “This research is the most important annual tool we have to educate our policy makers, so they can make better policy decisions to help the hardworking families and their family-owned businesses grow and prosper for generations to come.”
Soldano noted that FEUSA’s findings echo years of outside research, including studies from PwC and McKinsey, confirming that family businesses reinvest in their companies at consistently higher rates than non-family firms.
For an Executive Summary of the 2026 Annual Family-Owned Business go to: FEUSA 2026 Annual Family-Owned Business Survey.
About Family Enterprise USA
Family Enterprise USA promotes family-owned business creation, growth, viability, and sustainability by advocating for family businesses and their lifetime of savings with Congress in Washington, D.C. FEUSA represents and celebrates all sizes, professions and industries of family-owned enterprises and multi-generational employers. FEUSA is a 501.C3 organization
Contact Info:
Name: Bob Chew
Email: Send Email
Organization: Family Enterprise USA and Family Enterprise USA Action
Address: 712 H Street NE Suite 1330, Washington DC, United States
Phone: 310-383-0528
Website: https://familyenterpriseusa.com/
Video URL: https://www.youtube.com/watch?v=HBV5HEsFKss
Release ID: 89200999
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