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                               NEWS

March 3, 2010  Senate Passes Extension of Small Business Loan Guarantee Program Through March 28 -- Appropriates Additional $60 Million

U.S. Senate Committee on Small Business and Entrepreneurship Chair Mary L. Landrieu, D-La., praised the Senate's temporary extension of two important provisions enacted in the American Recovery and Reinvestment Act: increased government guarantees and eliminated fees on small business loans. The programs were extended for 30 days."The bill passed tonight by the Senate will extend access to health care benefits for workers who have lost their jobs, help small businesses get loans so they can grow and hire, and extend unemployment insurance benefits for millions of Americans who are looking for work," Obama said. "I'm grateful to the members of the Senate on both sides of the aisle who worked to end this roadblock to relief for America's working families," the statement said.

 

SBA News Release
PRESS OFFICE
**************
SBA Proposes Women-Owned Small Business Rule To Expand Access to Federal Contracting Opportunities

Release Date: March 2, 2010
Contact: Hayley Matz (202) 205-6948
Release Number: 10-05
Internet Address: http://www.sba.gov/news

WASHINGTON – The U.S. Small Business Administration today released a proposed rule aimed at expanding federal contracting opportunities for women- owned small businesses (WOSB). The proposed rule is available for public comment for 60 days.

The proposed rule is part of the Obama Administration’s overall commitment to expanding opportunities for small businesses to compete for federal contracts, in particular those owned by women, minorities and veterans. This proposed rule identifies 83 industries in which WOSBs are under-represented or substantially under-represented in the federal contract marketplace. This rule is aimed at providing greater opportunities for WOSBs to compete for federal contracts, while achieving the existing statutory goal that 5 percent of federal contracting dollars go to women-owned small businesses.

“Women-owned small businesses are one of the fastest growing segments of our economy, yet they continue to be under-represented when it comes to federal contracting,” said SBA Administrator Karen Mills. “Across the country, women are leading strong, innovative companies, and we know that securing federal contracts can be the opportunity that helps them take their businesses to the next level, expand their volume and create good-paying jobs. This proposed rule is a step forward in helping ensure greater access for women- owned small businesses in the federal marketplace.”

The creation of a rule to increase federal contracting opportunities for WOSBs was authorized by Congress in 2000. Since that time, SBA took a number of steps to study and analyze the market, including looking at participation by women-owned small businesses across all industries. Various draft rules were made available for public comment in prior years, but the Obama Administration chose last year to draft a new, comprehensive rule, based on the analysis of the prior studies and on all the questions and comments previously received.

Some of the components of the proposed Women-Owned Small Business rule include:

• To be eligible, a firm must be 51 percent owned and controlled by one or more women, and primarily managed by one or more women. The women must be U.S. citizens. The firm must be “small” in its primary industry in accordance with SBA’s size standards for that industry. In order for a WOSB to be deemed “economically disadvantaged,” its owners must demonstrate economic disadvantage in accordance with the requirements set forth in the proposed rule.
• Based upon the analysis in a study commissioned by the SBA from the Kauffman-RAND Foundation, the proposed rule identifies 83 industries (identified by “NAICS” codes) in which women-owned small businesses are under-represented or substantially under-represented.
o The SBA has identified eligible industries based upon the combination of both the “share of contracting dollars” analysis, as well as the “share of number of contracts awarded” analysis used in the RAND study. This differs from an earlier proposed version of the rule which identified only four industries in which women-owned small businesses were under-represented. This earlier version proposed to identify eligible industries based solely on the “share of contracting dollars” analysis used in the RAND study.
• In accordance with the statute, the proposed rule authorizes a set-aside of federal contracts for WOSBs where the anticipated contract price does not exceed $5 million in the case of manufacturing contracts and $3 million in the case of other contracts. Contracts with values in excess of these limits are not subject to set-aside under this program.
• The proposed rule removes the requirement, set forth in a prior proposed version, that each federal agency certify that it had engaged in discrimination against women-owned small businesses in order for the program to apply to contracting by that agency.
• The proposed rule allows women-owned small businesses to self-certify as “WOSBs” or to be certified by third-party certifiers, including government entities and private certification groups.
o The proposed rule requires WOSBs which self-certify to submit a robust certification at the federal ORCA Web site and also to submit a core set of eligibility-related documents to an online “document repository” to be maintained by the SBA. Each agency’s contracting officers will have full access to this repository.
o The SBA intends to engage in a significant number of program examinations to confirm eligibility of individual WOSBs.
o In the event of a contract protest or program review, the SBA will be entitled to request substantial additional documentation from the WOSB to establish eligibility.
o SBA intends vigorously to pursue ineligible firms which seek to take advantage of this program and in so doing to deny its benefits to the intended legitimate WOSBs.
 

NOTE (KP): An earlier study below listed 31 SIC codes as underrepresented (the new study will expand these to 83):

 

Using the non-public SBO data for the availability component of the disparity ratio and the FY05 FPDS/NG data from RAND study results for the utilization component, thirty-one of the 140 NAICS codes analyzed in the RAND study were identified as underrepresented or substantially underrepresented:

2361 -- Residential Building Construction,

3149 -- Other Textile Product Mills,

3152 - Cut and Sew Apparel Manufacturing,

3231 -- Printing and Related Support Activities,

3259 -- Other Chemical Product and Preparation Manufacturing,

3323 -- Architectural and Structural Metals Manufacturing,

3324 -- Boiler, Tank and Shipping Container Manufacturing,

3328 --Coating, Engraving, Heat Treating, and Allied Activities,

3369 -- Other Transportation Equipment Manufacturing,

3371 -- Household and Institutional Furniture and Kitchen Cabinet Manufacturing,

4412 -- Other Motor Vehicle Dealers,

4461 -- Health and Personal Care Stores;

4543 -- Direct Selling Establishments,

4841 -- General Freight Trucking,

4931 -- Warehousing and Storage,

5179 -- Other Telecommunications,

5312 --Offices of Real Estate Agents and Brokers,

5413 -- Architectural, Engineering, and Related Services;

5414 -- Specialized Design Services,

5417 -- Scientific Research and Development Services,

5419 -- Other Professional, Scientific, and Technical Services,

5614 - Business Support Services,

5615 -- Travel Arrangement and Reservation Services,

5619 -- Other Support Services;

5622 - Waste Treatment and Disposal,

5629 --Remediation and Other Waste Management Services,

6114 -- Business Schools and Computer and Management Training,

6115 -- Technical and Trade Schools,

6116 --Other Schools and Instruction;

6214 - Outpatient Care Centers,

8112 -- Electronic and Precision Equipment Repair and Maintenance,

8129 -- Other Personal Services.

 

SBA News Release  PRESS OFFICE

Statement from Administrator Mills on Continuing Support For Small Businesses through SBA Recovery Programs

Release Date: February 19, 2010

Internet Address: http://www.sba.gov/news

WASHINGTON SBA issued the following statement today from Administrator Karen Mills regarding efforts to ensure continued funding for two key provisions in the American Reinvestment and Recovery Act (ARRA) of 2009:

"SBA’s most popular ARRA provisions - the increased guarantee and reduced fees in the two largest lending programs - have helped engineer a significant turnaround in SBA lending. Continuing those ARRA provisions is SBA’s top priority. Through the original $375 million and the additional $125 million appropriations for these two provisions, SBA has supported more than $20 billion in lending to small businesses across the country and seen its average weekly loan volume increase by nearly 90 percent since February 2009.

Through ARRA we brought nearly 1,100 lending institutions back to the SBA’s programs that had not made an SBA loan since at least 2007. All told, these steps have benefitted tens of thousands of small businesses and supported hundreds of thousands of jobs during these tough economic times. However, we know there is still more work to be done. As the President has requested, we will continue to work with Congress to extend these programs through September 2010.

"The additional $125 million appropriation approved in December to extend SBA’s 7(a) loan guarantee to 90 percent and reduce or eliminate borrower fees on both the 7(a) and 504 loans will be used faster than expected. Loan volume has surged since earlier this week when an Information Notice was released to lenders. SBA communicated with its lending partners today that it will re-activate the Recovery Loan Queue no later than Monday, Feb. 22. The Queue is an efficient and transparent process that will ensure that every remaining dollar possible is made available to help small businesses drive economic recovery across the country.

"The SBA advocates for small businesses across the federal government and will continue its efforts to keep America’s small businesses on a path to recovery and long-term success. Small businesses are a central piece of President Obama’s Jobs Plan because they have been and will continue to be a key engine for job creation across the country. With that in mind, President Obama laid out an aggressive agenda for providing small businesses with the support they need to create jobs and drive economic recovery. That agenda includes proposals in three key areas: expanding access to capital; providing tax incentives to encourage job creation; and maximizing the potential of innovative, high-growth companies."

SBA’s ARRA Programs:

SBA received $730 million in ARRA to support economic recovery programs for small businesses. Included in the appropriation was $375 million to support raising the government guarantee to 90 percent on SBA’s 7(a) loans and reducing some lender and borrower fees on its 7(a) and 504 loans, the agency’s two largest lending programs. The funds for these popular provisions ran out in November 2009. SBA received an additional $125 million appropriation in December 2009 along with authority to continue both of the programs through February.

SBA’s 7(a) and 504 ARRA Transition Plan:

SBA is in the process of finalizing the plan for transitioning its 7(a) and 504 programs back to their pre-ARRA terms and communicating those plans with its lending partners. This plan, when implemented, will include re-activating the Recovery Loan Queues no later than Monday, Feb. 22, 2010. The Queues will operate in the same manner as when originally implemented in November 2009. Sometimes previously approved loans are later cancelled or never disbursed for a variety of reasons.

The Queues take this into account and beginning on the transition date will allow eligible small businesses, in consultation with their lenders, to choose to be placed in the queue for possible approval for an ARRA loan if funding becomes available. Small business owners and lenders will have transparent access to the queue via www.sba.gov/recoveryq and will be able to remove themselves from the queue at any time to be considered for a non-ARRA SBA loan with all applicable fees and, for 7(a) loans, standard guaranty levels.

The authorization for the 90 percent guarantee on 7(a) loans ends Feb. 28, 2010, though funds may be exhausted sooner. Furthermore, applications in the Queues after Feb. 28, 2010 will only be eligible for decreased or eliminated borrower fees when funds become available.

To learn more about SBA’s ARRA programs and other resources for small businesses, please visit www.sba.gov.

 

Banks pull another $1 billion from small business lending

chart_sm_biz_lending.top.gifBy Catherine Clifford, staff

NEW YORK (CNNMoney.com) -- The nation's biggest banks cut their collective small business lending balance by another $1 billion in November, according to a Treasury report released late Friday. The drop marked the seventh straight month of declines.

The 22 banks that got the most help from the Treasury's bailout programs have cut their small business loan balances $12.5 billion since April, when the Treasury began requiring them to file monthly reports on the tally. The banks' total lending has fallen 4.6% in that seven-month period, to $256.8 billion.

 

 

SBA Special Higher Guarantee and Waived Fees Extended to Feb. 28, 2010

On February 17, 2009, President Obama signed into law the American Recovery and Reinvestment Act of 2009 (the “Recovery Act”) (P.L. 111-5).  On March 16, 2009, SBA implemented sections 501 and 502 of the Recovery Act, which provide fee relief on 7(a) and 504 loans and an increased guaranty percentage on 7(a) loans.  Both initiatives have contributed to a significant resurgence in lending to small businesses by SBA’s participating lenders and Certified Development Companies (CDCs).  

 

Fed:  "Risks to U.S. economy have eased considerably"

Wed Sep 2, 2009 4:56pm EDT

 

By Mark Felsenthal

WASHINGTON (Reuters) - Federal Reserve policymakers last month believed risks to the U.S. economy had eased "considerably" and discussed stretching out a program that has held down home loan rates.

 

The Fed expressed confidence the deepest U.S. downturn since the 1930s was ending but also worried about weak growth ahead, according to minutes of its August 11-12 policy session released on Wednesday.

 

The U.S. central bank decided neither to expand nor contract its economy-supporting purchases of assets. "Meeting participants agreed that the incoming data and anecdotal evidence had strengthened their confidence that the downturn in economic activity was ending and that growth was likely to resume in the second half of the year," the minutes said.

Still, with the economy poised for a modest recovery at best, officials determined that low interest rates would be needed for an extended period.

 

"The (Fed) is in no hurry to alter its current policy stance," Paul Dales, an economist for Capital Economics in Toronto, said in a note to clients. "The Fed will complete its asset-purchasing program and remains reluctant to withdraw its policy support soon."

 

When it concluded its August meeting, the Fed had said the economy was showing signs of leveling out two years after the onset of the most virulent financial crisis in decades.

At the meeting, the central bank decided to keep benchmark overnight interest rates steady near zero and moved to phase out one of its emergency measures -- its $300 billion long-term Treasury buying program. It decided to let that program run several weeks longer than the original mid-September ending date to smooth the transition in markets.

 

The minutes showed that policymakers considered similarly stretching out and tapering off purchases of up to $1.25 trillion in mortgage-backed securities and up to $200 billion in mortgage agency debt, but made no decision. That program, which the Fed launched to drive down mortgage costs, is set to expire at the end of the year.

 

The Fed's purchases of MBS have already slowed, and market participants were widely expecting the central bank to stretch the program into next year to wean the market from its support.

So far this year, it has bought $792 billion in MBS and $118.6 billion in mortgage agency debt.

 

Policymakers also discussed adding adjustable rate mortgages to fixed-rate mortgages in its MBS buying program to cut costs for some borrowers, but made no decision.

 

Officials continued to worry the economy remained vulnerable to adverse shocks. The Fed officials had "particular concern" about weak labor markets and worried that sluggish income growth would hold back consumer spending, the minutes said. One big unknown was the degree to which households had turned more into savers than spenders.

 

The minutes showed officials also wrestling with the question of whether the unusually low level of interest rates and billions of dollars they had pumped into the economy could eventually spark inflation.

 

"Cash for Clunkers" Program

 

Included in the military spending bill signed last month by President Obama was legislation designed to help get gas guzzlers off U.S. highways. Officially known as the Car Allowance Rebate System (CARS), this program will provide vouchers toward the purchase of new fuel-efficient vehicles made before November 1, 2009. The program will begin after July 1, 2009, following issuance of regulations by the National Highway Traffic Safety Administration (NHTSA).

 

To be eligible for the voucher, the “clunker” must have a rating of 18 MPG or less, be
manufactured within the last 25 years, be in drivable condition, and have been insured by the same owner for the last year. The replacement vehicle must cost no more than $45,000 and have at least a 22 MPG rating (18 MPG for light duty trucks). The NHTSA will issue a voucher for $3,500 if the new vehicle is at least 4 MPG better than the traded-in vehicle (2 MPG for light duty trucks) and a $4,500 voucher if the new vehicle is at least 10 MPG better (5 MPG for light duty trucks).

 

No details are available yet, but it appears that the CARS program will be handled through automobile dealers, who will reduce the invoice price by the applicable amount. All information about the program will be listed on the official government web site (www.cars.gov).
 

Government readies emergency small biz loans

Starting June 15th, struggling companies will be able to apply for up to $35,000 in debt-relief loans through a new stimulus program.

NEW YORK (CNNMoney.com) -- One week before its emergency loan program is slated to launch, the Small Business Administration issued guidelines for banks and borrowers on how the new loans will work.

 

Called "America's Recovery Capital," ARC loans are designed to make up to $35,000 available to struggling small business owners to temporarily help them keep up with payments on existing loans, including credit card debt. Authorized as part of February's stimulus bill, the program has been under development for four months. Many banks were waiting for the SBA's procedural guidance, released Monday, before deciding whether or not to participate.

Here's a primer on how the emergency loans will work.

 

Eligibility: Sorry, startups, this isn't for you. ARC loans are only open to businesses that have been in operation for at least two years and have been profitable in at least one of the last two years. (Startup businesses can apply for financing through other SBA programs, including the agency's flagship 7(a) loan program.)

Borrowers can use ARC loans to make payments for up to six months on their existing debt, with no repayment due on the loan for another year. After that, the business has five years to pay back the loan principal. The government covers the interest payments.

 

Talk back: What do you think of ARC loans?

Applicants must prove they are experiencing financial hardship, as evidenced by declining sales (a drop of at least 20% over the past year), frozen credit lines, rising business costs (again, 20% or more in the past year), or difficulty meeting payroll, paying rent or making loan payments.

But borrowers also have to be running a "viable" business. The SBA wants to see cash-flow projections for at least the next two years illustrating that the business will be able to repay its ARC loan and other debt obligations. Borrowers must have "acceptable" business credit scores, and they can't be more than 60 days past due on any loan they'd like ARC funds to help cover. Lenders may also require collateral to back up the loan.

 

Qualifying debt: Because of arcane government rules, ARC loans can't be used to make payments on loans backed by the SBA before Feb. 17, 2009, the date the stimulus bill took effect. However, borrowers can use the loans for relief from virtually any other business debt, including a commercial mortgage or lease, home equity loans used to finance business operations, bank loans made outside the SBA program, notes payable to suppliers, and credit card debt.

That last one is a key feature. Borrowers can use ARC loans to cover payments on their personal credit cards if the money was borrowed for business expenses. "We do recognize the merging of the owners' and businesses' finances," says Eric Zarnikow, the SBA's associate administrator for capital access.

 

How to apply: The SBA won't make ARC loans directly. As with most of its lending programs, it will instead offer guarantees on loans made by banks. If the business owner defaults, the SBA pays off the debt. (The business owner still takes a hit on their credit report.)

Each bank will set its own procedures and timeline for issuing loans, so business owners looking to apply should contact a participating bank. For a list of banks that make SBA loans, click here. Each business can receive only one ARC loan, for a maximum of $35,000, but that loan can be used to make payments on more than one debt.

The SBA will begin processing applications for the loans on June 15, but individual banks may take longer to draft their own application procedures.

 

What's in it for banks: ARC loans are a sweet deal for borrowers: They carry no fees, require no payments for at least a year, and have their interest payments fully subsidized by the government.

 

That, and the fact that they're specifically targeted at businesses in trouble, makes them especially risky. Banks have been wrangling with the SBA for years about underwriting standards for their small business loans: The government can penalize lenders for high default rates in their portfolios, which has made some banks nervous about participating in the ARC loan program.

 

Collecting the government guarantee on a loan gone bad can be onerous, and banks have to absorb the administrative costs of pursuing delinquent loans and liquidating those that default. The SBA says it expects ARC loans to default at a higher rate than its other programs, and will adjust its expectations for lenders accordingly. Because the loans are fully guaranteed by the government, ARC loans are fairly safe for banks. But the interest rate on them isn't very competitive. The SBA has set the interest rate it will pay for the loans at prime plus 2%. For June, that rate would be 5.25%.

 

That's a lower interest rate than the SBA sets for its other loan programs. However, unlike ARC loans, those programs don't offer a 100% loan guarantee -- on a traditional SBA loan, if a business defaults, banks would be stuck with some of the loss.

 

Availability: The SBA estimates that around 10,000 small businesses will receive ARC loans, but it's uncertain how quickly the loans will be dispersed. "It's a little challenging to anticipate what the demand will be," Zarnikow says. "There will be ramp-up time as lenders train operators."

In the Recovery Act, Congress allocated $255 million to support the ARC loan program. That money covers only the program's subsidies, for interest payments and defaults, allowing the money to stretch to support a larger dollar-volume of lending. Each lender will be limited to 50 loans per week. If a bank makes less than 50 loans, they can carry the unused allocation over to other weeks, but lenders will be capped at a maximum of 1,000 loans through the program's duration.

 

The ARC loan program is scheduled to run through Sept. 30, 2010, or until its funding runs out, whichever comes first. To top of page

 

Keate Partners' Marketing & Advertising Sources

 

Through our national marketing program, Keate Partners is pleased to announce the following advertising sources (using a generic description of each business) used by Keate Partners on all companies we represent to provide national (confidential) exposure - in addition to our own website which provides extensive local and regional exposure with over 10,000 “hits” per month.

National and International Websites

BizBuySell.com   BizQuest.com   BusinessMart.com   MergerNetwork.com

 

The Wall Street Journal Online The New York Times Online American City Business Journals - Bizjournals

 

Regional Websites

Alabama
Birmingham Business Journal
Arizona
The Business Journal of Phoenix
California
SFGate - San Francisco Chronicle Sacramento Business Journal San Francisco Business Times
Silicon Valley/San Jose Business Journal Los Angeles Business Journal
Colorado
Denver Business Journal
District of Columbia
Washington Business Journal
Florida
Jacksonville Business Journal Orlando Business Journal South Florida Business Journal
Tampa Bay Business Journal
Georgia
Atlanta Business Chronicle
Hawaii
Pacific Business News - Honolulu
Kansas
Wichita Business Journal
Kentucky
Business First of Louisville
Maryland
Baltimore Business Journal
Massachusetts
Boston Business Journal
Minnesota
Minneapolis St. Paul Business Journal
Missouri
Kansas City Business Journal St. Louis Business Journal
Nevada
Las Vegas Review Journal
New Mexico
New Mexico Business Weekly
New York
Business First of Buffalo The Albany Business Review
North Carolina
Charlotte Business Journal The Business Journal of the Greater Triad Area - Greensboro Triangle Business Journal - Raleigh-Durham
Ohio
Business Courier of Cincinnati Business First of Columbus Dayton Business Journal
Oregon
Portland Business Journal
Pennsylvania
Philadelphia Business Journal Pittsburgh Business Times
Tennessee
Memphis Business Journal Nashville Business Journal
Texas
Austin Business Journal Dallas Business Journal Houston Business Journal
San Antonio Business Journal
Washington
Puget Sound/Seattle Business Journal
Wisconsin
Mikwaukee Business Journal

 

 

President Signs Massive Stimulus Bill

 Excerpted from "American Recovery and Reinvestment Act of 2009"

 Tax Briefing Special Report Online February 13, 2009

 

The much anticipated American Recovery and Reinvestment Tax Act of 2009 was signed by President Obama on February 17, 2009. This stimulus bill designates roughly $800 billion to help jump start the economy, nearly $300 billion in tax relief alone. Both individuals and businesses will benefit as most of  the tax incentives are retroactive to January 1, 2009.

 

·          GENERAL TAX RELIEF

o  "Making Work Pay" Credit – Provides an individual tax credit of 6.2% of earned income not to exceed $400 for single returns and $800 for joint returns in 2009 and 2010. The credit is phased out at adjusted gross income (AGI) in excess of $75,000 ($150,000 for married couples filing jointly).

o    First-Time Homebuyer Tax Credit – Extends the current credit for homes purchased before 12/1/09; increases the maximum credit amount to $8,000 ($4,000 for married taxpayers filing separately); and waives the repayment requirement for purchases in 2009.

o   Child Tax Credit – Increases the refundable portion of the child tax credit for 2009 and 2010.

o   Tax Deduction on Vehicle Purchase – Allows itemizers and non-itemizers to deduct sales and excise taxes incurred on the purchase of a new vehicle.

o   Suspension of Tax on Unemployment Compensation –Temporarily suspends federal income tax on the first $2,400 of unemployment benefits received in 2009.

 

·          EDUCATION

o   American Opportunity Tax Credit – Increases Hope credit to 100% of first $2,000 and 25% of next $2,000 for first 4 years of post-secondary education; extends credit to include course materials; increases AGI limits; allows credit against AMT; and makes a portion refundable.

o   Technology Treated as Higher Education Expense – Enables taxpayers to use distributions from Section 529 accounts to purchase computer equipment and internet access while beneficiary is enrolled at educational institution.

 

·          AMT RELIEF

o   AMT Patch – Increases exemption for 2009 to $70,950 for married individuals filing jointly and surviving spouses; $46,700 for other unmarried individuals; and $35,475 for married individuals filing separately.

 

·          BUSINESSES -

o   Bonus Depreciation – Extends 50% first year bonus depreciation to eligible property placed in service during 2009.

o   Section 179 Expensing – Increases the maximum deduction to $250,000 for 2009. Phase-out starts at $800,000. Therefore, most small businesses with capital needs under this amount may be able to claim a full deduction for machinery and equipment purchased in 2009.

o   NOL Carryback – Allows eligible small businesses to elect up to a five-year carryback of a net operating loss for a tax year ending or beginning in 2008.

o   S Corp Built-in Gains Tax – Reduces from 10 to 7 years the holding period for assets subject to this tax. This reduction applies to C Corps converting to S Corps for tax years beginning in 2009 and 2010.

 

·          ENERGY

o   Plug-in Vehicles – Modifies the existing credit; adds a new 10% credit (up to $2,500) for plug-in electric vehicles that are low-speed, motorcycles, or three-wheeled; adds a new 10% credit (up to $4,000) for conversion of a motor vehicle to a qualified plug-in vehicle. Hybrid vehicles are not eligible for this credit.

o   Residential Energy Efficient Property – Extends and modifies the credits available for purchases of insulation, water heaters, furnaces, windows and other solar, geothermal and wind energy property.

o   Alternative Motor Vehicle Credit – Allows taxpayers to use this as a personal credit against the AMT.

 

 

Reduction in Capital Gains Rate May Expire in 2010

2003 Tax Bill: In 2003, the US Senate narrowly passed a tax relief bill that President Bush called "a vital action that will stimulate the economy and create jobs." This new bill cut the Long Term Capital Gains Tax Rate to just 15%. Unless extended, this rate reduction expires in 2010.

Historical Rates: As illustrated below, historical capital gains tax rates have fluctuated considerably. The rate is now at a 60 year low representing a windfall for business owners that sell now.

Historically, the rate has changed every 4 years and while future rates are obviously impossible to predict, the next likely change will be to increase the capital gains tax to help with the large federal deficit.

 

Aug2009newsletter

 

 

 

Keate Partners Ltd.

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