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What the Small Business Bill Means for You

You’ve probably heard about it, read about it, or even watched the news stories on TV. And now its official, President Obama has signed the small business bill into law. But what does this mean for you and your business?

A few of the highlights:

1) Small banks will be loaned money by the government, who in turn make loans to small businesses. The small banks will receive significant interest discounts for repayment of their loans only if these banks can increase the dollar amounts loaned to small businesses by 10 percent.

2) The government is waiving fees for SBA loans. In addition, the maximum allowable loan was increased for several varieties of SBA loans. The 7(a) and 504 programs increased maximum loan amounts from 2 million to 5 million dollars, while the Express program increased maximum loan amounts from 3 hundred thousand to 1 million dollars.

3) New tax write-off laws are available for purchasing capital, changing the time periods in which write-offs can be accomplished.

The SBA could hopefully back increased amounts (both monetary and numerically) of loans to small business owners. The SBA’s monetary numbers for backing loans are down this year ($16.84 billion) from 2007 ($20.61 billion). This bill could provide a much needed boost for business financing. But be aware, due to the down economy, banks are still setting stringent standards for loans. So if you’re looking for financing, be sure to get your ducks in a row.

Needleman, Sarah E. “Businesses Put Up for Sale Smack Into Harsh Reality.” The Wall Street Journal [New York] 14 October 2010, pages B1+.

Moran, Gwen. “Here’s What’s Actually In The Small Business Bill.” Business Insider. 13 September 2010. 18 October 2010 .

Associated Press. ” Senate set to clear $30B credit for small business.” The Florida Times Union. 14 September 2010. 18 October 2010 < http://jacksonville.com/business/small-business/2010-09-14/story/senate-set-clear-30b-credit-small-business >.

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