Tax Bulletin Nov 2010: Small Business Jobs Act of 2010

Misnamed, but Useful

By Kathryn Wilson, CPA & Susan Sterne, CPA, Principal

President Obama signed the Small Business Jobs Act of 2010 (SBJA) into law on September 27, 2010. The Act’s title is a misnomer – it includes provisions relevant to businesses of all sizes, expands the delayed taxation of Roth rollovers beyond IRAs and contains no direct employment incentives. We’ve divided the tax provisions of the SBJA into five sections:

Your favorite depreciation accelerants: back and better than ever!
Read this if: you have bought or plan to buy depreciable property in 2010 or 2011.

Business investment: Congress endeavors to sweeten the deal
Read this if:

  • You started a new business in 2010
  • Your business generates business credits, and its annual gross receipts for the three tax years before 2010 averaged $50 million or less
  • Your business in an S-corporation that used to be a C-corporation whose first year as an S-corp began in 2006 or later

Other taxpayer-favorable provisions
Read this if:

  • You’re self-employed and pay health insurance premiums
  • You use a cell phone for a business purpose or your business provides cell phones for employees
  • You have a retirement plan such as a 401(k) plan, 403(b) plan or government 457 plan

Miscellaneous tax code clean-up
Read this if:

  • You paid or were upset that other people paid disproportionate penalties related to listed and reportable transactions.
  • Your business pays fees to a foreign business or person who guarantees your debt or receives such fees

Revenue raisers: 1099 reporting
Read this if:

  • You file information returns such as 1099
  • You pay any of your business vendors more than $600 a year
  • You receive rent
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