Friday, January 29, 2010

President Obama's Small Business Tax Credits

The details of President Obama’s small business tax credits are now becoming more clear. They are:

A $5000 tax credit for every net new employee

Small businesses that increase wages or hours for their existing employees will be reimbursed for the Social Security payroll taxes they pay on the increase payroll.

Firms will be able to claim the credit on a quarterly basis.

Will this encourage you to hire more employees or increase wages?

Are these tax credits more important than increasing the ability of small business to access capital?

I am getting calls from the media on this so I would appreciate your response.

Yesterday I was on the call with the White House people. I asked the question about continued stimulus funding for the SBA 7a and 504 loans. This funding would be used to continue the 90% guarantee on loans and the waiver of fees. It also would allow the SBA to make loans up to $5 million. Unfortunately my question did not get answered and it is not clear how much effort the President will make to make sure money is available after February.

Scott Hauge
Small Business California
2311 Taraval Street
San Francisco, CA 94116

1 comment:

Martin Small said...

It will definitely be interesting to see how this plan works for small business and if it will really give them the financial help they need. However, there are still some options that small businesses have available, and one of those options is a business cash advance. It’s cash given up front to businesses when they need it, and is based upon the cash flow from monthly credit card sales charges. They don’t have to make monthly payments like with small business loans; instead small debits are automatically taken from batched credit card sales which will make repaying the money much easier.