On February 17, President Obama signed into law the American Recovery and Reinvestment Act—an economic stimulus plan totaling $787 billion in federal spending and tax cuts. For small business owners who don’t want to wade through the actual document, the Better Business Bureau offers a summary on some items in the stimulus package that might benefit them.
The main goal of the stimulus package is to spur job creation—Congressional Budget Office estimates that employment could increase by as much as 3.6 million jobs by 2010—with the concept being that more jobs will provide additional assistance to struggling consumers and businesses. For business owners, this means increased federal spending on projects—such as funding for the U.S. Small Business Administration to assist businesses with financing needs—and small businesses can also look forward to some tax breaks.
“The stimulus package is addressing the troubled economy from many angles, and while most of us will receive benefits as an individual through tax breaks, there are perks for business owners as well,” said Barb Grieman, interim president of the Better Business Bureau of MN and ND. “Experts agree that a healthy job market goes hand-in-hand with a healthy economy, and frankly, many businesses need the help immediately to stem the tide of employee lay offs.”
Following are examples of how the American Recovery and Reinvestment Act will benefit small businesses nationwide:
Small Business Financing
The U.S. Small Business Administration will receive $730 million from the stimulus package—more than doubling their operating budget from 2008— to help assist businesses with financing.
According to a press release from the SBA, funds will be divided among many programs including:
For complete details on how the U.S. Small Business Administration will use the new funding from the stimulus package and how small businesses can benefit, go to www.sba.gov.
Small Business Tax Breaks
Industry and State-Specific Benefits
The stimulus package will provide state and local governments with billions of dollars to fund assistance programs and infrastructure projects, such as road construction or mass transit development. More details on how state-specific funding will be dispersed and which projects will benefit will be announced soon.
Green businesses will also see a benefit, including $20 billion dollars set aside for companies that produce solar panels and wind turbines, $6 billion in loan guarantees for renewable energy projects, and a 30 percent tax break for investments in wind and solar energy.
Additional information on the stimulus package can be found at www.recovery.gov.
For more small business advice from your BBB including tips for surviving a tough economy, go to www.bbb.org.