WASHINGTON - U.S. Senator Tom Udall today released the following statement after President Obama signed into law the Small Business Jobs Act, which will help small businesses create 500,000 new jobs nationwide through $12 billion in new tax cuts, increased small business lending and expanded access to private capital. The Senate approved the legislation by a 61-38 vote earlier this month.
"While the economy is continuing to recover from the worst recession since the Great Depression, it's not improving fast enough - not for the thousands of out-of-work New Mexicans or for anyone who has struggled to pay the bills over the last few years. What this new law does is help establish the right kind of economic conditions for small businesses - which have created two-thirds of all new jobs in American over the last 15 years - to expand, hire more workers and lead our economy to full recovery. When small businesses succeed, Americans succeed. I was pleased to vote for this important legislation earlier this month, and look forward to it helping New Mexicans grow their businesses and create good jobs."
Additional Background on the Small Business Jobs Act, which goes into effect today:
Promote Entrepreneurship
• Increases to $10,000 the tax deduction for start-up expenditures - doubling the current levels.
• Creates new tools to help small businesses export goods, which will leverage more than $1 billion in exports.
• Establishes a new State Export Promotion Grant Program (STEP), which would increase the number of small businesses that export goods to other countries.
Increase Small Businesses' Ability to Make Investments
• Increases Section 179 expensing - permitting up to $500,000 in capital investments that businesses can expense.
• Extends Bonus Depreciation - allowing taxpayers to immediately write off 50 percent of the cost of new equipment.
Help Small Businesses Access Capital
• Incentivizes investors by giving 100 percent exclusion from capital gains taxes on small business investments.
• Creates a targeted $30 billion Small Business Lending Fund to provide small community banks with capital to increase small business lending.
• Gives $1.5 billion in grants to support $15 billion in new small business lending through already successful state programs.
• Reduces the tax burden for small businesses by allowing them to carry back general business tax credits to offset their tax burdens from the previous five years. Small businesses will also be able to count the general business credits against the Alternative Minimum Tax (AMT), freeing up capital for expansion and job growth.
• Increases Small Business Administration (SBA) loan limits and improves access and lowers costs for small business to access SBA loans.
Promote Fairness in Competition
• Improves tax fairness by preventing small businesses from incurring large tax penalties aimed at large corporations and wealthy individuals investing in tax shelters.
• Improves small business contracting by clarifying that no single contracting program receives priority over another program when competing for federal contracts.
• Allows self-employed individuals to deduct health insurance costs for purposes of paying the self-employment tax.
