Excerpts From Nancy Pelosi Speech on American Recovery and Investment Act

Many of you have asked what the Federal Stimulus package has for small business. Please see below information I have received from Speaker Pelosi’s office.

Do any of these things benefit you?

I received an email from one of our members Burr, Pilger and Mayer. They are an accounting firm in SF. The content of the email was that President Obama on Jan 22 signed HR 4462 that allows donors to Haitian earthquake victims after Jan 11, 2010 to March1 2010 to take an itemized deduction in their 2009 taxes. Please contact your accountant for more specifics.

I just received word that Volunteers In Medicine has opened its 77 clinic. These are in 25 states around the country. Our Volunteers in Medicine clinic,Clinic by the Bay, is moving right along and we believe we will be opening in the summer of 2010. Thank you to all that have made a contribution.


Scott Hauge
President
Small Business California
2311 Taraval Street
San Francisco, CA 94116
shauge@cal-insure.com
415-680-2188


Small Business/Business Excerpts From Speaker Nancy Pelosi’s Speech on American Recovery and Reinvestment Act

Business Tax Incentives to Create Jobs and Spur Investment ($10 billion over 10 years)

· Bonus Depreciation: Help businesses quickly recover costs of new capital investments by extending the increased bonuses depreciation for businesses making investments in new plans and equipment in 2009.

· Buying Back Debt: Provides assistance to companies looking to reduce their debt burdens by delaying the tax on businesses that have discharge indebtedness, which will help these companies strengthen their balance sheets and obtain resources to invest in job creation.

· Small Business Expensing: Spurs small business investment by extending small business expensing, which doubles the amount small businesses can immediately write off their taxes for capital investments and purchases of new equipment made in 2009 from $125,000 to $250,000. This write off phases out completely for investments over $800,000 (up from $500,000).

· Small Business Loss Carrybacks: Increases cash flow for small businesses by providing a 5-year carryback of net operating losses (NOLs). This would allow small businesses (with gross receipts of less than $15 million) to write off losses incurred in 2008 against taxes assessed over the previous five years (current law limits NOL carryback to the previous two years), thereby reducing their taxes this spring.

· Small Business Investment: Spurs investments in small businesses by cutting the capital gain tax on investors in small businesses who buy stock (in the next two years) and hold for more than five years – increasing from 50 percent to 75 percent the capital gains that are excluded from tax.

· 3% Government Withholding: Delays the mandate that federal, state, local governments withhold 3 percent of payments to businesses for goods and services, which is supported by the National Small Business Association.

Spurring Job Creation by American Businesses Large and Small

American businesses, large and small, are the engine of the economy. The American Recovery and Reinvestment Act, signed into law by President Obama on February 17, expands opportunities for small business, and contains incentives for businesses of all sizes to invest in new plants and equipment. The measure will strengthen a broad range of industries, such as renewable energy, construction and manufacturing, and information technology, which are critical to creating jobs now, as well as transforming our economy for the 21st Century.
Creating Small Business Opportunities (Invests over $1 billion to create an estimated 645,000 jobs)

· Spurs more than $21 billion in new investment in small business and small business loans, with guarantees needed to make loans more attractive to lenders and free up capital for small businesses. By making the Small Business Administration a more active partner and by unfreezing credit markets, this will give small firms access to the capital they need to stay afloat, create jobs and help drive economic recovery.

o Eliminates all fees on SBA-backed loans.
o Establishes a new program that will allow SBA to make no-interest loans to firms that are struggling to make payment on existing debts.
o Raises from 85 to 90 percent the portion of a loan that the Small Business Administration will guarantee.
o Spurs investment in high-growth, small firms by streamlining the Small Business Investment Company (SBIC) program to allow them to invest more flexibly.

· Guarantees nearly $3 billion in loans for rural businesses at a time of unprecedented demand due to the credit crunch. Private lenders are increasingly turning to this program to help businesses get access to capital.

· Invests in Economic Development Assistance (EDA) to address long-term economic distress in urban industrial cores and rural areas, distributed based on need and ability to create jobs and attract private investment. Every $1 in federal EDA funds leverages $10 in private investments.

Business Tax Incentives to Create Jobs and Spur Investment ($76 billion in 2 years; $10 billion over 10 years)

· Bonus Depreciation: Helps businesses quickly recover costs of new capital investments by extending the increased bonus depreciation for businesses making investments in new plants and equipment in 2009.

· Buying Back Debt: Provides assistance to companies looking to reduce their debt burdens by delaying the tax on businesses that have discharged indebtedness, which will help these companies strengthen their balance sheets and obtain resources to invest in job creation.

· Small Business Expensing: Spurs small business investment by extending increased small business expensing, which doubles the amount small businesses can immediately write off for capital investments and purchases of new equipment made in 2009 from $125,000 to $250,000. This write off phases out completely for investments over $800,000 (up from $500,000).

· Small Business Loss Carrybacks: Increases cash flow for small businesses by providing a 5-year carryback of net operating losses (NOLs). This would allow small businesses (with gross receipts of less than $15 million) to write off losses incurred in 2008 against taxes assessed over the previous five years (current law limits NOL carryback to the previous two years).

· Small Business Investment: Spurs investments in small businesses by cutting the capital gain tax (by increasing from 50 percent to 75 percent the capital gains that are excluded from tax) for investors in small businesses who buy stock (in the next two years) and hold for more than five years.

· 3% Government Withholding: Delays the mandate that federal, state, and local governments withhold 3 percent of payments to businesses for goods and services, which is supported by the National Small Business Association.
Creating Small Business Opportunities

· Rural Business Loans: Guarantees nearly $3 billion in loans for rural businesses at a time of unprecedented demand due to the credit crunch.

· Small Business Loans: Spurs more than $21 Billion in new investment in small business and small business loans, with guarantees needed to make loans more attractive to lenders and to free up capital for small businesses. This will give smaller firms access to the capital they need to stay afloat, create jobs and help drive an economic recovery.

o Eliminates all fees on SBA-backed loans
o Establishes a new program that will allow SBA to make no-interest loans to firms that are struggling to make payment on existing debts.
o Raises from 85 to 90 percent the portion of a loan that the Small Business Administration will guarantee.

· Bonus Depreciation: Helps businesses quickly recover costs of new capital investments by extending the increased bonus depreciation for businesses making investments in new plants and equipment in 2009.

· Small Business Expensing: Spurs small business investment by extending increased small business expensing, which doubles the amount small businesses can immediately write off for capital investments and purchases of new equipment made in 2009 from $125,000 to $250,000. This write-off phases out completely for investments over $800,000 (up from $500,000).

· Economic Development: Invests in Economic Development Administration (EDA) programs to address long-term economic distress in urban and rural areas, distributed based on need and ability to create jobs and attract private investment. Every $1 in federal EDA funds leverages $10 in private investments.

· As the Farm Bureau noted: “Farmers and ranchers will also greatly benefit from the extension of both the small business expensing levels and bonus depreciation tax, which will help them improve cash flow while aiding the economy by encouraging purchases of equipment.”