SmallBiz Vote
  • A simple home office tax deduction is coming

    If you’re among the many small business owners who regularly forfeit the home office tax deduction for fear of attracting an audit or because it is just too complicated to calculate, there’s good news for you out of Washington today.

    The Small Business Administration and the IRS have coordinated to provide “a new, simpler option for calculating the home office tax deduction.” Taking the deduction will no longer require calculating the energy costs, mortgage interest, homeowner’s insurance, property taxes, and repairs you pay on your home office as a percentage of the entire home. Instead, small business owners and employees who work from a qualifying home office will have the option to deduct $5 per square foot of office space on up to 300 square feet, for as much as $1,500 in deductions annually.

    According to the IRS’s calculations, the simpler formula will save taxpayers more than 1.6 million hours per year in tax preparation time. One hitch: the new rule won’t go into effect till

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  • Law lifts cap on women-owned small business contracts

    Last week we reported on small-business-supportive language contained in the National Defense Authorization Act of 2013 that is aimed at helping small businesses win more contracts with the federal government. One provision of the law signed by President Obama on January 2 is particularly promising for women small business owners. It removes caps on the dollar amounts of awards for which women-owned businesses are eligible.

    Not only have government agencies consistently failed to meet the goal to award 23 percent of contracts to small businesses, but they also failed to meet the Women Owned Small Business Federal Contracting program goal to award 5 percent of contracting dollars to women-owned businesses. In 2011, the first year of the program, federal agencies awarded $16.8 billion in contracts to women-owned small businesses, which accounted for only 3.98 percent of federal contract dollars, according to the Small Business Administration.

    Advocates say the caps—$6.5 million for

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  • 9 tips for getting government contract dollars

    As founder of Government Business Solutions, Lourdes Martin-Rosa is a small business owner who has been generating income from government contracts for a decade. Her $3+ million company provides event management and human resources solutions to government agencies. Eager to help other women business owners do the same, she has been advocating on behalf of the women’s procurement program for 12 years and serves as an American Express OPEN advisor on government contracting.

    Contracting can be a lucrative revenue booster for women-owned small businesses, Martin-Rosa says. “It can be very important to have a strong customer like the federal government.” In fact, while fewer than 2 percent of all small businesses that contract with the government generate revenues in excess of $1 million, 42 percent of women-owned small business contractors generate that much or more, according to recent American Express OPEN government contracting survey.

    But there are 83 industries (see WOSB program

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  • Waiting for the equity-based crowdfunding story to start

    Had you asked any entrepreneurship observers six months ago to predict the top small business stories of 2013, equity-based crowdfunding would surely have been on the list. Now, many fear the story might be delayed another year, or worse, end before it ever started.

    The new practice that would allow unaccredited investors to take stakes in small startups through online portals was made legal by the JOBS Act last April. Not to be confused with donation-based crowdfunding—which entrepreneurs and inventors such as Jonathan Lansey have been using successfully for several years—equity-based crowdfunding would allow funders to reap a financial return on investments or loans that help startup businesses get off the ground. Pioneers of a new equity and debt-based crowdfunding sector pounced on the opportunity and prepared for the law to take effect in 2013.

    But to their disappointment, the Securities and Exchange Commission has failed to issue the rules that were mandated by the Act to open

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  • Small business advocates react to cliff deal

    How will the fiscal cliff deal struck by Congress at the last minute this week impact small business? Depends whom you ask.

    The Wall Street Journal reports that the increased tax rates for individual personal income over $400,000 “could impact hundreds of thousands of small-business owners who report their company's profits as personal income.” The New York TimesYou’re the Boss Blog reports that “though advocates for small businesses were concerned that legislators might overlook their interests in the high-pressure negotiations, it turns out that their pessimism was unfounded.” And small businessman and columnist Gene Marks explains why “the fiscal cliff resolution may or may not be good for my small business--but it's a very, very good thing for puppies.”

    Here’s a roundup showing which small business advocates say the deal is good, bad, or a little of both for small business.

    Bad: National Small Business Association President Todd McCracken: “Although supportive of several tax

    Read More »from Small business advocates react to cliff deal
  • Law aims to help small businesses get federal contracts

    Lawmakers are trying to do something about the fact that federal agencies have failed to meet small business contracting goals for six consecutive years. A new law requires senior agency employees to defend future failures in their performance reviews and bonus discussions. That and several others measures aimed at helping small businesses compete for federal contracts are included in the National Defense Authorization Act of 2013 that was signed into law by President Obama this week.

    House Small Business Committee Chairman Sam Graves (R-MO) called the legislation “the culmination of a comprehensive effort to reform contracting policy so that small businesses can better compete in the federal procurement marketplace.” Graves said his 112th Congress committee had prioritized “the concerns of small contractors who want to seek business opportunities with the federal government” and had “uncovered various barriers that made it harder for small businesses to succeed.”

    According to Graves,

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  • Small business owners bracing for cliff fall

    In the countdown to the nation’s fall over the edge of the fiscal cliff, small business advisors and advocates are imploring Congress and President Obama to come together.

    While many small business owners remain paralyzed with uncertainty about 2013 budgeting, others are taking action. Based on the assumption that Congress will not reach an agreement in time to avoid the cliff, about half of business owners are making changes to prepare for higher tax rates next year, according to results of a survey conducted by financial information company, Sageworks.

    The survey conducted between December 12-18 collected online responses from 164 Sageworks clients, who are accountants and business advisors to privately held businesses. The responses reflect what those professionals hear from those they advise:

    • More than half of accountants surveyed said their business clients were making changes in their companies in response to fiscal cliff uncertainty.
    • Almost 30 percent said their business clients
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  • In online opinion pieces this week, two leading observers of small business economics criticized the Obama Administration and Congress.

    American Small Business League President Lloyd Chapman released a statement and blogged on the Huffington Post his prediction that “the Obama administration will try to use the momentum from the fiscal cliff debate to justify plans to dismantle the Small Business Administration” by folding it into the Commerce Department. Chapman questions the Administration’s estimates that such a move would save $3 billion over 10 years. He calls the potential agency merger “just a scam to direct 100 percent of federal contract dollars to large corporations.”

    Chapman argues that “eliminating federal programs for America’s chief job creators would be economic suicide” and suggests that instead, the President should “triple the SBA’s budget and supercharge every federal program for the nation’s 27 million small businesses.”

    In a blog post titled The Decline of Small

    Read More »from Not supporting small business is economic suicide, observers of economy say
  • Tough to get for some, venture funding boosts revenues and jobs

    chart: IEGC and Pepperdine University Graziadio School of Business and Management

    What’s a great way to accelerate sales and job growth for your company? A private equity investment or, even better, venture capital funding can translate to significant growth for small and medium-sized businesses, according to two finance professors who studied thousands of workplaces with 500 or fewer employees. The fact might seem like a no-brainer, but the data are dramatic.

    One caveat: Securing that kind of financing can be especially challenging if you’re a minority, female, or foreign business owner, the study showed.

    The publication, Did they build that? The role of private equity and venture capital in small and medium-sized businesses, released by the Institute for Exceptional Growth Companies and Pepperdine University’s Graziadio School of Business and Management, documents Graziadio professors John Paglia and Augus Harjoto’s research into the performance of more than 8,000 workplaces that had received such financing between 1995 and 2009.

    Their study showed that, versus

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  • Self-Employment Assistance Center to Help States Help Startups

    Small Business Administrator Karen Mills and Department of Labor Secretary Hilda Solis announced today that their agencies have partnered on a new program designed to help citizens who are receiving unemployment insurance to start their own businesses.

    The program, targeted at state agencies and state legislators, will deliver resources at the state level so that all 50 states can provide self-employment assistance in the form of financial assistance, entrepreneurial training, and other resources to unemployed residents interested in launching businesses and creating new jobs.

    The launch of the SBA/DOL Self-Employment Assistance Center website follows the release of a DOL guidance earlier this year governing state Self-Employment Assistance, or SEA, programs. The guidance—contained in the Middle Class Tax Relief and Job Creation Act of 2012, which provided $35 million for states to create SEA programs and expand entrepreneurship opportunities—offers assistance and model legislation for

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SmallBiz Vote discusses candidates, policy, and news of the 2012 U.S. elections from the perspective of business owners and entrepreneurs.

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  • Adrienne Burke, Blogger/Writer, Yahoo! Small Business

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