Summary of the Small
Business Jobs Act
Business Jobs Act
Provisions to Provide Access to Capital
100% Exclusion of Small Business Capital Gains.
Generally, non-corporate tax payers may exclude 50 percent
of the gain from the sale of certain small business stock acquired at original issue and held for more than five years. For stock acquired after February
17, 2009 and before January 1,2011, the exclusion is increased to 75 percent. At the time of sale, however, 28% of the excluded gain will be treated as a tax
preference item subject to the alternative minimum tax (AMT)...
Provisions to Encourage Investment
Increase of Section 179 Expensing and Expansion to Certain Real Property.
Under current law, taxpayers may
elect to write-off the costs of certain tangible personal property that is purchased for use in the active conduct of a trade or business in the year of
acquisition in lieu of recovering these costs over time through depreciation. For the taxable year beginning in 2010, taxpayers may write-off up to $250,000
of these capital ...
Provisions to Promote Entrepreneurship
Increased Deduction for Start-up Expenditures.
Under current law, taxpayers may deduct up to $5,000 in
trade or business start-up expenditures. The amount that a business may deduct is reduced by the amount by which start-up expenditures exceed $50,000.
Start-up expenditures are defined as expenses paid or incurred in connection with investigating or creating an active trade or business, which would be
deductible if paid or incurred in connection with the operation of an existing trade...
Provisions to Promote Small Business Fairness
Modify Section 6707A Penalty.
The bill revises section 6707A of the Internal Revenue Code to make the
penalty for failing to disclose a reportable transaction proportionate to the underlying tax savings. The penalty for failure to disclose reportable
transactions to the IRS would be set at 75 percent of the tax benefit received. Reportable transactions are defined as investments in transactions that
the IRS has identified as listed...
Offset - Reducing the Tax Gap
Require Information Reporting for Rental Property Expense Payments.
The bill requires persons receiving
rental income from real property to file information returns to the IRS and to service providers reporting payments of $600 or more during the year
for rental property expenses. In general, there is an exception for individuals renting their principal residences, including active members of the
military, from the reporting requirements. This provision is estimated to raise...
Offset - Promoting Retirement Preparation
Allow Participants in Governmental 457 Plans to Treat Elective Deferrals as Roth Contributions.
Beginning
in 2011, the bill would allow retirement savings plans sponsored by state and local governments (governmental 457(b) plans) to include Roth accounts,
which are currently available only in 401(k) and 403(b) plans and will be available in the federal Thrift Savings Plan in 2011. Contributions to Roth
accounts are made on an after-tax basis, but distributions ...
Offset - Closing Unintended Loopholes
Crude Tall Oil Ineligible for Cellulosic Biofuel Producer Credit.
In 2008, Congress enacted a $1.01 per
gallon tax credit for the production of biofuel from cellulosic feedstocks in order to encourage the development of new production capacity for biofuels
that are not derived from food source materials. Some taxpayers are seeking to claim the cellulosic biofuel tax credit for processed fuels that are highly
corrosive, such as crude tall oil (another waste by-product ...
Other Provisions
Use of Predictive Modeling and Other Analytics Technologies to Identify and Prevent Waste, Fraud and Abuse in the
Medicare Fee-for Service Program.
The bill would require the Secretary to contract with private companies to conduct predictive modeling
and other analytics technologies to identify and prevent payment of improper claims submitted under Parts A and B of Medicare. The Secretary would be
required to identify the ten states ...
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