Small business tax hacks
Congress is considering two bills that aim to get more cash into small business owners' hands.
(Fortune Small Business) -- Two bills introduced on Capitol Hill in July aim to revise the tax code and get more money flowing into small business coffers.
Free lunch? A bill from Rep. Neil Abercrombie, D-Hawaii, would raise the deductible percentage of business meals from 50% to 80%.
This could be a boon for America's restaurants, 70% of which are small businesses. The National Restaurant Association says the bill could boost business meal sales by $6 billion a year. It would also help frequent lunchers: Restaurants are the top destinations for entrepreneurs meeting outside their offices, and two-thirds of all business meal deductions are by small business owners.
Jump Start. The Small Business Jump Start Act, introduced by Sen. Jeff Merkley, D-Ore., and Sen. Lamar Alexander, R-Tenn., would allow a small business to deduct $10,000 of startup expenses in the first year if its total costs are less than $60,000; those limits are currently set at $5,000 and $50,000, respectively.
"This makes sure you get money back into the business when you really need it -- up front," says Bill Rys, tax counsel for the National Federation of Independent Business.
But, he notes, Congress has a crowded fall schedule, and the bill would have the effect of cutting revenue for a government that is running deficits. Rep. Frank Kratovil, D-Md., introduced a similar bill, with a $20,000 deduction limit, in the House of Representatives in March.To write a note to the editor about this article, click here.