2009 Obama Small Business plan and IRS tax breaks

This post contains a summary of the 2009 Obama's small business plan. Obama has alloted $15 billion to revive small businesses and help the U.S. economy. If you are looking for latest news or confirmed update on this plan, note that the precise details of this plan are not out yet and they could be available as early as by the end of this month. You may wish to bookmark this page and visit again for updates on 2009 Obama's small business plan.

Now lets look at what is expected of this $15 billion small business stimulus. Scroll down for latest on IRS tax breaks for small businesses.

Anyone who had followed the 2008 presidential debates between Barack Obama and John McCain would have noticed the rhetoric regarding 'Joe the Plumber' which had was a small reflection of what Obama was planning to do for small businesses in the United States. There are over 25 million small businesses in America and over 99% of all employees are small business employees. Given this and the current recession or economic downturn, any reasonable 'recovery policy' must take into account small businesses and try to boost them by giving tax cuts, tax breaks, refunds, rebates or other stimulus.

Here are the highlights of 2009 Small Business Plan (announced earlier) of Barack Obama and Joe Biden:

Obama Small Business Health Tax Credit: This is a tax credit provided to small businesses to reduce healthcare costs of employees. Under this new 2009 tax credit, all small businesses will be provided a refundable tax credit of 50% of the premiums paid by small businesses on behalf of the employees.

Zero Capital Gains and Other Tax Relief for Small Businesses and Start Ups: Capital Gains taxes on small and start up businesses will be eliminated. This proposed small business tax break is expected to reduce tax burden on businesses.

Expand Loan programs for Small Businesses: In order to increase small businesss line of credit Obama administration will work to help more small business entrepreneurs get loans, expand the network of lenders, and simplify the loan approval process.

Apart from the basic small business stimulus mentioned above there are a number of other points proposed earlier by Obama to revive small businesses in 2009. You may read more details of their small business vision on Barack Obama and Joe Biden's plan for Small Businesses.

The IRS has also announced series of significant new tax breaks for small businesses.

• Small businesses with average earnings upto $15 million (qualifying limit) in gross receipts annually over a three-year period will be allowed to claim losses for the past five years in the current tax year. This limit prevents larger business' from claiming this tax exemption. It also means many firms should get refunds now, rather than have to wait to deduct 2008 losses from future profits after the economy recovers. But firms must decide whether to use the five-year carry back provision and which year it applies to by April 17.
• Small businesses may write off upto $250,000 in investments this year.
• Small businesses can reduce estimated tax payments to 90 percent of the previous year's filing.
• Small businesses will be allowed to take larger depreciation deductions within the first year of property purchases.
• For those who invest in small businesses, 75% of capital gains will be excluded.

I will update the info and also provide authentic links soon.