Congress passed a SEMA-supported $16 billion “jobs bill” which is intended to expand the American workforce. Pending a final procedural vote by the Senate, the bill will be sent to President Obama to be signed into law. All businesses that hire a new employee before January 1, 2011, will be exempt from paying the 6.2% employer share of Social Security payroll taxes. The new worker must have been unemployed for at least 60 days and cannot replace another employee.
If the business retains the newly hired worker for one year, the employer is then entitled to a one-time $1,000 tax credit for each such worker. The legislation also extends the “Section 179” expensing provision, allowing small businesses to write-off up to $250,000 of capital expenditures made during 2010 rather than recovering the costs over time through depreciation.
The bill also increases the investment cap to $800,000 for 2010 rather than $500,000 indexed for inflation. President Obama intends to quickly sign the bill into law.
For more information, contact Stuart Gosswein.