Obama Signs 2010 Small Business Jobs Act

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President Barack Obama signed into law the Small Business Jobs Act, which increases the limits on SBA guaranteed 7(a) loans from $2 million to as much as $5 million.

The act will jump-start the SBA’s year-old dealer floorplan financing program (DFP), which has struggled to attract participation from lenders and was set to expire at the end of this month. The Recreation Vehicle Dealers Association (RVDA) and its allies successfully petitioned for a three-year extension of the program and for the higher loan limits, according to a news release.

RVDA comments are aimed at improving the SBA’s dealer floorplan program, which was set to expire at the end of September. RVDA will have more details on the DFP extension and any new provisions as they become available from SBA.

Other provisions of the bill include the creation of a $30 billion fund that provides capital to small community banks to prompt small business lending, and $12 billion in tax breaks for businesses.

Other important provisions of the bill include:

• $1.5 billion to support existing state small business credit initiatives.
• Small businesses will be able to immediately expense up to $250,000 in capital spending. The law also extends tax provisions that allow all businesses to more quickly write off purchases of new equipment and other depreciable property.
• To encourage investments in small businesses, the law excludes some small business stock sales from capital gains taxes.
• Small business deductibles for start-up costs will be doubled to $10,000.
• The law frees up capital by allowing small businesses to carry-back general business tax credits to offset taxes paid over the previous five years, instead of the current one year carry back. Anything left over can be carried forward for 20 years.
• The law’s cost is to be offset by revenue-raising provisions aimed at clarifying and tightening tax rules, including tightening eligibility for a tax credit on corrosive biofuels such as crude tall oil, a by-product of paper manufacturing.

Click here for more information on SBA Loan Programs in RVDA’s Lenders Toolbox