Small-Business Bill Clears Senate Hurdle

Finally, there appears to some good news on the horizon for small business owners and franchisees looking for capital. Reports out of Washington indicate that the Senate has moved closer to completing work on a bill that includes a range of measures aimed at spurring small-business access to capital.

With the support of two moderate Republicans, Senate Democrats were successful in reaching the necessary 60-vote threshold on a vote that makes a final vote on the legislation likely later this week. The bill would create a new lending facility which would see taxpayer money directed to regional banks on the condition that they boost their lending to smaller firms. A provision in the bill would allow small businesses to partially write off the cost of health insurance, a provision currently limited to larger companies.

However, there is a slight catch.

Senate Republicans were unsuccessful in eliminating the reporting requirement which was inserted in the health-care legislation that President Barack Obama signed into law earlier this year. The rule requires businesses to report to the Internal Revenue Service payments to suppliers and service providers that exceed $600 in a single year. It is set to be implemented in 2012. The effort is aimed at providing the IRS with more information on income that now goes unreported. It is estimated that the information will help to increase tax collections by $17 billion over 10 years, a projected amount that was used to offset the cost of the health-care overhaul legislation.

According to the Wall Street Journal article a spokesperson from the Treasury Department said that they will attempt to lessen the impact of this reporting requirement on small businesses.

About the author: Ed Teixeira, publisher of Franchise Know How, is a 35 year veteran of the franchise industry, operating franchise companies in convenience store, manufacturing , home health care and medical staffing sectors. He was also a home healthcare franchisee.