Progress Report: Small Business Tax Relief Act of 2009
We posted a piece a few months ago about a new bill called the Small Business Tax Relief Act of 2009, proposed by Senator Charles Grassley, R-Iowa. Now, your business, and bank account, may be benefitting from the recent upswing in the stock market over the past months, but you may have noticed that job creation and small business financing have still been a struggle. And that you have had to face tough choices such as cutting staff or cutting health care. One topic that is always hot among small business owners is taxes--and how to make them work in favor of Main Street.
With those considerations in mind, you may be wondering, yeah, whatever happened to that proposed legislation? Is it any closer to becoming law? Well this is your follow-up.
First, here's a summary of the bill's features to jog your memory. The proposed Small Business Tax Relief Act of 2009 would:
- decrease business tax liability while increasing deductions
- would make bigger businesses eligible for tax benefits
- increase "Section 179" expensing (i.e. the portion of the tax code that allows deductions for qualifying equipment purchased and put into service in a given tax year) from $250,000 to $500,000, and wouldn't phase out any deduction unless a business spent more than $2 million on qualifying equipment in a given year.
- benefit small and not-so-small businesses, by keeping general business credits out of a business' Alternative Minimum Tax, as long as the business has less than $50 million in annual receipts and is not a publicly traded corporation.
- extend the carryback provisions for general business credits from 1 to 5 years
- expand Net Operating Loss provisions of the tax code, allowing bigger businesses to spread current year operating losses over longer range of prior tax years
And, now, the update, according to govtrack.us:
- the bill was introduced on June 25th 2009
- it has been referred to congressional committee for evaluation and review, and remains in that phase
- note: most bills do not receive committee consideration and do not make it out out of committee to general debate
Considering the proposed bill has spent months in committee, if you have been holding your breath for these reforms for modest and somewhat-bulky small businesses, you may want to exhale and investigate other tax relief options available.
Related Resources:
- 'Small' Business Tax Relief Act of 2009? (FindLaw's Free Enterprise)
- Tax Cuts for Small Business in Obama's Proposed 2010 Tax Plan (FindLaw's Free Enterprise)
- Sole Proprietors: NOL Carry Back Set to Expire Oct 15 (FindLaw's Free Enterprise)
- Corporate Taxation (in FAQs) (provided by The Roberts Law Firm, P.C.)