You may have read through the fine print contained in the Small Business Jobs Act of 2010 (signed in to law on September 27, 2010), but what does it really mean and how does it impact you, your business, your family, and those around you? What can you do now to plan for later? Here are some highlights of the Small Business Jobs Act, and what it means in layman’s terms (conveniently divided for ease of reading):
Access to More Capital:
Higher Loan Limits:
– Microloan limits have been permanently increased from $35,000 to $50,000, which should dramatically help entrepreneurs with start-up costs
– 7(a) and 504 limits have been increased from $2 million to $5 million (for manufacturers in the 504 loan program, the limit has been increased to $5.5 million)
Alternative Size Standards:
– The alternate size standard has been increased so that more small businesses have access to SBA loans. Now, the law includes those businesses with less than $15 million in net worth and $5 million in average net income.
SBA Enhanced Loan Provisions:
– Through December 31, 2010, SBA loan provisions have been extended. This should provide $14 billion more in lending support via the SBA.
Open Competition for Contracts:
More Opportunities for Small Businesses:
– This law eliminates the “Competitiveness Demonstration” program. Essentially, this will mean that small businesses have a better shot of being awarded contracts in 11 specific industries (such as construction, landscaping and pest control).
Equal Treatment across Federal Contracting Programs:
– All small businesses will be treated the same way. When contracts are awarded that are designated for small businesses, those owned by women and sevice-disabled veterans, as well as businesses participating in the HUBZone and 8(a) programs will all be eligible and treated equally.
Small Business Exporting:
Increased Staff and Strengthened Export Counseling Resources:
– Will make the path to business exporter more clear and accessible to every small business
Export Express Pilot
– The Export Express pilot loan program is now permanent. This provides 90% guarantees for loans made up to $350,000 and 75% for loans between $350,000 and $500,000.
State Trade and Export Promotion Pilot
– This pilot program will provide $90 million to states as competitive grants during the next three years to help small business owners learn how to export.
Training and Counseling Expanded:
In 2010 and beyond, $50 million in grants will be available to Small Business Development Centers.
$12 Billion in Tax Relief to Help Small Businesses Invest in their Firms and Create Jobs:
8 Tax Cuts:
1. Higher business expensing limit ($500,000).
2. General business credits are now carried back five years.
3. Accelerated/bonus depreciation
4. Zero capital gains taxes for those who invest in small businesses
5. Increased deductions for start-ups
6. Deductions for employer-provided cell phones
7. Deductions for health insurance costs for those who are self-employed
8. Limitations on penalties for errors in tax reporting that disproportionately affect small businesses.
General/Expanded Information: http://finance.senate.gov/legislation/details/?id=da799068-5056-a032-5229-92cebbd2b7a0
Amended Small Business Acts of 2010: http://www.sba.gov/jobsact/