Jeff Bingaman United States Senator from New Mexico

WASHINGTON – U.S. Senator Jeff Bingaman today voted to approve a bill to give small businesses and community banks the tools they need to help create jobs. The legislation was approved 61-38.  The bill will now be considered by the House of Representatives, which is expected to pass it and then the President is expected to sign it.

The Small Business Jobs Act, which aims to spur job creation through a combination tax credits, improvements to Small Business Administration (SBA) lending, counseling and contracting programs, and the development of new community bank lending facilities, contains a provision written by Bingaman that would provide tax relief for self-employed Americans who purchase health insurance.  This will help the many self-employed New Mexicans better afford to buy health insurance for themselves and their families.

"Small businesses continue to struggle to access the capital they need to get their businesses off the ground," Bingaman said.  "The initiatives in this bill will help give entrepreneurs the credit and tools necessary to create jobs."

The bill contains the following provisions intended to spur job creation:

Helps Small Businesses Access Capital

• Incentivizes investors by giving 100% exclusion from capital gains taxes on small business investments.
• Creates a targeted $30 billion Small Business Lending Fund to provide small community banks with capital to increase small business lending.
• Gives $1.5 billion in grants - including $13.5 million for New Mexico - to support $15 billion in new small business lending through already successful state programs.
• Reduces the tax burden for small businesses by allowing them to carry back general business tax credits to offset their tax burdens from the previous five years.  Small businesses will also be able to count the general business credits against the Alternative Minimum Tax (AMT), freeing up capital for expansion and job growth.
• Increases Small Business Administration (SBA) loan limits and improves access and lowers costs for small business to access SBA loans.

Increases Small Businesses' Ability to Make Investments

• Increases Section 179 expensing – permitting up to $500,000 in capital investments that businesses can expense.
• Extends Bonus Depreciation – allowing taxpayers to immediately write off 50 percent of the cost of new equipment.

Promotes Entrepreneurship

• Increases to $10,000 the tax deduction for start-up expenditures – doubling the current levels.
• Creates new tools to help small businesses export goods, which will leverage more than $1 billion in exports.
• Establishes a new State Export Promotion Grant Program (STEP), which would increase the number of small businesses that export goods to other countries.
• Provides $300,000 additional funding for the 22 Small Business Development Centers in New Mexico.

Promotes Fairness in Competition

• Improves tax fairness by preventing small businesses from incurring large tax penalties aimed at large corporations and wealthy individuals investing in tax shelters.
• Improves small business contracting by clarifying that no single contracting program receives priority over another program when competing for federal contracts.
• A provision written by Bingaman that allows self-employed individuals to deduct health insurance costs for purposes of paying the self-employment tax.