House Suggests Bigger Tax Break For Start-ups


The Wall Street Journal:

Just a few days after President Obama announced a stimulus plan for small businesses, more breaks might be in the works.

Rep. Frank Kratovil of Maryland, a Democrat, and Rep. Chris Lee of New York, a Republican, proposed amending IRS code to allow new businesses to write off more of their operating costs.

The bill, the grandly named Small Business Formation and Job Creation Act, would raise the start-up business deduction to $20,000 from $5,000.

The National Federation of Independent Business threw its support behind the bill, saying the legislation provides incentives for risk takers.

“Most new small businesses face significant start-up costs, including advertising, obtaining licenses, permits and fees, paying rent, hiring business and financial consultants and providing employee training,” said Susan Eckerly, senior vice president of federal public policy at the NFIB. “This increase in the start-up deduction allowance for new businesses will help new firms survive the challenging and often expensive first year of business.”

Photo by cliff1066.

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