The American Recovery and Reinvestment Plan

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The American Recovery and Reinvestment Plan has now passed through the US House of Representatives and will likely be passed by the Senate in the coming days.  Though certain sections of the plan may change, several of the current initiatives boast programs and incentives that can benefit small business owners.  Find out now which programs you will qualify for and what you can do to take advantage of them.

Are you in need of new equipment for your business?  Early last year, the 2008 stimulus bill increased maximum Section 179 expenses to $250,000 but this expired in December 2008. If you made such investments last year, be sure to remember them when you send your year end information to your tax professional.  The good news is that the American Recovery and Reinvestment Plan will continue that threshold through the end of 2009 giving you several more months to make purchases that can increase your efficiency and productivity.

The number of loans guaranteed under the Small Business Association’s loan program are down 57%.  The upcoming recovery plan includes $430 million dollars for new direct lending as well as loan guarantees making loans to business owners more attractive to lenders.  In addition to freeing up capital for loans, an elimination of capital gains taxes on investments made in small and start-up businesses will reduce the tax burden. 

Other highlights of the economic recovery program include:

  • $90 billion to modernize roads, bridges, transit systems and waterways;
  • $79 billion in state fiscal relief to prevent cutbacks in key services;
  • $54 billion for renewable energy/green jobs;
  • $39 billion to help jobless workers obtain or continue health care coverage;
  • $16 billion for science and technology investments, including expanded broadband access.

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How will you make the most of the opportunities this plan will create for small businesses?  Read the text of the current proposals and be prepared for the ways you and your company can participate in the recovery.  Also check out the SBA website where they offer information on the programs that help you position your business to take advantage of contract openings throughout the Federal and State Governments.

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