President Trump on Sept. 27 said the GOP tax plan "will protect low-income and middle-income households," adding that the proposal is "not good for me." (The Washington Post)

Last-minute changes to the Senate tax bill could personally benefit President Trump, who has investment stakes in roughly 500 entities that could be affected by the planned adjustments.

Republicans are seriously considering expanding a new tax credit that these types of entities use to lower their taxable income in a way that benefits most people tied to these firms. Trump and other senior administration officials have been in personal contact with lawmakers about the changes.

The changes focus on “pass-through” entities, companies that direct income through the individual income tax code and not the corporate tax code. There are millions of these entities, and they are most often sole proprietorships, limited liability companies or partnerships. Trump’s stakes in these entities include many large and small ventures, including the Trump Organization.

Trump’s 2005 tax return showed that he had more than $109 million in income from businesses, partnerships and pass-through entities, although he has not released updated figures, so the precise impact is not known.

Trump has become the first president in 40 years to refuse to release his tax returns, making it hard to know exactly how much he would gain from his tax policy. But a letter from Trump’s lawyers last year said nearly all his companies count as pass-through entities.

“You hold interests as the sole or principal owner in approximately 500 separate entities,” Morgan Lewis attorneys Sheri Dillon and William Nelson wrote in a letter released by the Trump campaign. “Because you operate these businesses almost exclusively through sole proprietorships and/or closely held partnerships, your personal federal income tax returns are inordinately large and complex for an individual.”

Many of Trump’s signature properties, including the Mar-a-Lago Club in Palm Beach, Fla., and the Trump-branded golf courses across the country, are linked to limited liability companies that would qualify as pass-throughs under the tax code, financial disclosure filings show.

Senate Republicans have proposed changing the way these firms pay taxes, allowing them to deduct 17.4 percent of their income from their taxable income.

But Sen. Ron Johnson (R-Wis.) has said he would not support such a bill because he doesn’t believe it’s generous enough for pass-through entities. Now Republican negotiators, to mollify Johnson, are looking at changing the tax bill and expanding it to allow people to deduct 20 percent of a firm’s income.

Such a change could expand the tax benefit for Trump because of his investments, although the precise details of the change couldn’t be learned. Such details would affect what benefit — if any — Trump would receive.

“The President’s top priorities are delivering tax cuts for the middle class and making our businesses competitive again, both of which will jumpstart our economy. Everyone will benefit when our economy is performing at its best,” said Raj Shah, the White House’s deputy press secretary.

Sen. Steve Daines (R-Mont.) has privately expressed concerns to White House officials that are similar to the ones raised by Johnson, and Daines personally spoke with Trump about the pass-through issue Sunday night.

Trump on Monday didn’t say what specific changes to the tax bill would look like, although he did say the provision relating to pass-throughs would be made simpler.

Democrats have attacked the GOP tax proposals and alleged that they would disproportionately benefit companies while offering limited and temporary benefits for families and individuals. Trump has said he would not personally benefit from the tax changes, telling senators that his accountant said he would actually fare worse under the tax bill than if no changes were made. But the White House has not offered any details to explain how he came to this viewpoint, and many say Trump and his family would benefit greatly.

“He would definitely benefit personally, and in a number of different ways,” said Steven M. Rosenthal, senior fellow at the Tax Policy Center, an organization that analyzes tax proposals and is often criticized by congressional Republicans for its reports that have found limited benefits to their tax ideas.

The tax-cut bill that passed the House of Representatives would treat pass-through entities differently than the Senate bill would.

The House bill would cut the top tax rate these entities pay from 39.6 percent to 25 percent, while the Senate bill would instead allow these companies to deduct a percentage of their income.

Firms that pay taxes through the corporate tax code would see their tax rate fall from 35 percent to 20 percent under both the House and Senate bills, a change many chief executives support because it would lower their taxes. But there has been more hand-wringing over the treatment of pass-through entities.

Johnson said the tax treatment of these entities in the Senate bill is not generous enough and puts them at a disadvantage. Republicans have looked at ways to grow this deduction, possibly allowing companies to deduct about 20 percent of their income, according to four people briefed on the talks who spoke on the condition of anonymity because they weren’t authorized to discuss ongoing negotiations.

Johnson’s office has said he did not support an initial version of the Senate bill because it would have roughly doubled the gap between corporate tax rates and the income tax rates pass-throughs pay. Pass-through entities — S corps, partnerships and limited liability companies — are frequently small businesses, but they can also be large entities, such as National Football League teams, Fiat Chrysler, a Koch Industries subsidiary and big liquor distributors. Johnson also has a personal stake in several pass-through entities from his corporate background, but his office said the changes he is pushing would not benefit him personally.

Millions of firms pay their taxes as pass-throughs, but tax writers for months have been concerned that people could easily take advantage of special tax treatment to avoid paying taxes. For example, a hedge fund manager or wealthy doctor could try to design their tax status in a way so they could qualify as a “pass-through” and pay a lower tax rate than people who earn much less money. Republican tax writers have said they have tried to develop ways to prevent such tax avoidance, but it’s unclear whether their strategies would work.

The support of Johnson is crucial because the GOP controls 52 votes in the 100-seat Senate, and Republicans can only afford to lose only two votes if they want to pass their bill with a simple majority. They did receive some good news Monday, however, when Sen. Rand Paul (R-Ky.) announced he would back the measure.

In an opinion piece published by Fox News, Paul wrote that the Senate GOP tax bill wasn’t perfect — he hoped for even bigger cuts — but said that Congress could come back and do more at a later time. He also said he was pleased with the inclusion of a provision repealing the individual mandate in the Affordable Care Act, which creates penalties for many Americans if they don’t have health insurance.

“This tax bill is a true test for my colleagues. I’m not getting everything I want — far from it. But I’ve been immersed in this process. I’ve fought for and received major changes for the better — and I plan to vote for this bill as it stands right now,” Paul wrote.

“I urge my colleagues to do the same. I urge you, their constituents, to make sure they hear from you.”

The Trump administration says its tax plan is intended to help ordinary Americans, but some key Republican figures have acknowledged that big business and political donors stand to benefit. (Taylor Turner/The Washington Post)

Erica Werner, Drew Harwell and Jonathan O’Connell contributed to this report.