Jobs Act Expands Tools for Small Business Growth in Lakewood

By Calvin W. Goings, Administrator, Region 10 Small Business Administration

The Small Business Jobs Act, signed by President Obama on September 27, will provide critical resources to help small businesses continue to drive economic recovery and create jobs. The new law extends the successful SBA Recovery loans while offering billions more in lending support and tax breaks for entrepreneurs and small business owners.

The new law provides $12 billion in critical tax relief to help small businesses invest in their firms and create jobs. The eight tax cuts include:

1. The highest small business expensing limit ever, of $500,000
2. Carry-back provisions on net operating losses of up to 5 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 the self-employed
8. Limitation on penalties for errors in tax reporting that disproportionately affect small business.

The law will also extend SBA Recovery loans (with 90% guarantee and reduced fees) through December 31, 2010. The $505 million for Recovery loans in this new law will support approximately $14 billion in overall small business lending. Nationally, more than 1,400 small businesses that have been waiting for this bill to become law. In Washington state 26 small businesses have been waiting for this important legislation to pass and now will receive needed funding.

Additionally, the law will permanently increase SBA loan limits from $2 million to $5 million (for manufacturers, it will increase up to $5.5 million), as well as expand the number of businesses eligible for SBA loans. The law will permanently increase microloan limits from $35,000 to $50,000, helping larger entrepreneurs with start-up costs and small business owners in underserved communities.

To provide support to another critical sector of the economy, the law provides temporary enhancements to help with working capital and commercial real estate refinancing by increasing the maximum amount of the SBA Express loans from $350,000 to $1 million. And the law will allow some small businesses to refinance their owner-occupied commercial real estate mortgages into SBA’s successful fixed asset program.

The law turns the Export Express pilot loan program into a permanent program with 90% guarantees for loans up to $350,000 and 75% for loans between $350,000 and $500,000. And, the law provides $60 million in competitive grants over the next three years for states to help small business owners with exporting.

The resources in this new law build on the success of SBA’s earlier efforts while providing important new tools. Each one of them is aimed at helping America’s small business do what they do best – grow and create good jobs. For more information: www.sba.gov/jobsact/