To follow up on our last piece on the stimulus package and how it benefits small businesses, Obama has since added additional measures to the stimulus package. And of course we wanted to give you the latest run down of the provisions and how you and your company could possibly benefit from it.

The administration has now set aside $730 million dollars of the stimulus package to free up credit, increase loan guarantees, and eliminate loan fees:

• 15 billion dollars of stimulus money will unfreeze the secondary loan market so small businesses can get loans.
• Loan fees for popular small business loans will be eliminated through 2009.
• Loan guarantees will be increased up to 90 percent on qualified loans.
• The 21 largest banks that get government funding must submit monthly reports about how much lending they do for small businesses.

This new aid plan is important to small businesses because the loan makes it easier and more affordable to get funding to upgrade or purchase new business equipment, increase inventory, or invest in other areas of the business.

Besides the new aid package, generous tax breaks will help out small businesses even more. This means that small businesses:

• With earnings up to $15 million can claim losses for the past five years in 2009.
• Can write off up to $250,000 in investments.
• Can reduce estimated tax payments to 90 percent of last year’s filing.
• Can take larger depreciation deductions within the first year of property purchases.
• Will see 75 percent of capital gains excluded for those that invest in small businesses.

These tax breaks are useful because they allow small businesses to more affordably invest in capital expenses such as computers, copiers or other big ticket items that will improve their businesses while also stimulating the economy.

The government is also creating a new small business loan. The America’s Recovery Capital (ARC) loan program will offer the following:

• Deferred payment loans up to $35,000 for viable small businesses that need help making payments on existing loans.
• Loans will be 100 percent backed by the Small Business Administration (SBA).
• Loan repayment doesn’t begin until 12 months after the loan is completely disbursed.

The ARC loan is important to small businesses. It will help them pay off past debt while getting finances back on track. ARC loans will also help small businesses keep existing jobs and create new ones.

Small businesses should take advantage of the new loan programs as soon as possible. These generous loan terms will make credit more affordable and will help small businesses stay open, allowing them to keep and create new jobs. Small businesses should 1) contact a financial advisor to learn more about the best loan program for their businesses and 2) Contact All Covered and learn how to use loan funds to upgrade technical business equipment and gain the competitive edge.

Download PDF