Congressman Elijah E. Cummings, (MD-07) was proud today to vote for H.R. 5486, the Small Business Jobs Tax Relief Act of 2010. This legislation will spur investment to small businesses, while offering tax incentives to help small businesses grow, hire, and fuel our economy. The bill is fully paid for and complies with pay-as-you-go budget law.
"There must be no more important concern for this Congress right now than putting Americans back to work," said Cummings. "Small businesses are responsible for creating the majority of the jobs in our nation, and have been for years. The only way we can get our economy moving again is to make sure entrepreneurs on Main Street have the capital they need to expand and to put our fellow Americans back to work. I am proud to help move that process along, and I will continue to fight every day to create good American jobs."
The bill increases the capital gains tax cut for those who invest in small businesses this year. The bill would exclude 100% of capital gain income for stock in small businesses purchased from March 15, 2010 to January 1, 2011. It also fixes a tax shelter disclosure penalty that disproportionately impacts small businesses. This measure was endorsed by the Small Business Council of America, and makes penalties for failing to disclose reportable transactions on their taxes proportionate to the tax savings for small businesses. Finally, there is an increase in tax deductions for a start-up business. The deduction for start-up costs will increase to $20,000 and allow more businesses to qualify for the maximum deduction. By allowing entrepreneurs to recover more start-up expenses, small business owners can focus more on hiring new workers and growing their businesses.
To pay for these credits, the bill closes tax loopholes permitting a tax credit for crude tall oil (a waste byproduct like black liquor) and allowing rich families to pass on wealth while cutting their estate and gift taxes.