On Tuesday, Rep. Judy Chu, D-Calif., introduced a bill to provide low-income start-up companies with financial and business assistance. The Entrepreneur Startup Growth Act provides self-employed individuals with tax support and business development.
"Economists point to young developing businesses as the key drivers of economic growth. On average each year about one third of the jobs created in this country are a result of new startup businesses. These entrepreneurs take risks and make it on their own," Chu said. "The most critical time of the year for these new owners is tax season as they learn how to comply with the different tax standards for businesses. The Entrepreneur Startup Growth Act turns this tough time into an opportunity by offering affordable business tax assistance in conjunction with business development services so these companies can continue to grow and create jobs."
The Entrepreneur Startup Growth Act builds on the Self-Employment Tax Initiative launched by CFED, a nonprofit economic opportunity organization. The legislation creates a grant program that would offer free business tax preparation services to low-income self-employed individuals who file a schedule C tax return. This will help their businesses grows and it promotes asset-building for low-income households.
"This program will help entrepreneurs save money and ensure that they access all the tax credits for which they are eligible," continued Chu. "By building their economic security and helping them grow their business we drive American job growth."
9.8 million self-employed individuals -- nearly two-thirds of all self-employed people -- are operating business startups: unincorporated businesses less than five years old that are still in their developing stages and feature just one employee, the business owner himself. Startups in their first year of existence create an average of 3 million jobs per year. Nearly all net job creation since 1980 has occurred in small business startups less than five years old.