Small businesses are the engine of job creation in America. With over 50 percent of Americans working or owning a small business, it is important that we seize every opportunity to support these businesses across the country. That is why I am writing to you about a new initiative started last year called Small Business Saturday. Most Americans know Black Friday and cyber Monday as big days for holiday shopping. Small Business Saturday is a day dedicated to supporting small businesses during the holiday season. It is as easy as walking into the local shop on your Main Street. These local businesses are the job creators in your community and every community in the country. Supporting these independent business owners is mission critical.

When I walk around my own neighborhood in Washington, it’s just great to see mernbers of my community helping each other. People supporting each other is what we’re all about in this country, and no one does that better than the small business owner who buys from the local farmer, sells to the local patron and hires the local employee. These people are taking care of each other every day in America and supporting them is a privilege.

I am writing to ask for your help. First, please consider doing business with a small business on Small Business Saturday, which this year is on Saturday, November 26. Second, encourage others to do the same, whether they are your family, friends or members of your own community. Third, help us spread the word across your networks. The websites www.sba.gov/saturday and www.Smal lBusinessSaturday.com provide a wealth of information including vendors and other ways to get involved. Tell the businesses you work with to register on the website and to promote their participation. Work with them to prepare for a busy holiday season so they cag maximizethe opporfunity in front of them.

As the holiday season begins I want to take a moment to thank you for all the work you do to support America’s small business community. I know the example we all set helps to drive our nation forward throueh these economic times.

Sincerely,

Michael Chodos
Associate Administrator
Office of Entrepreneurial Development

Release Date: August 4, 2011
Contact: David J. Hall  (202) 205-6697 Or Dennis Byrne (202) 205-6567
Release Number: 11-46
Internet Address: http://www.sba.gov/news

WASHINGTON, D.C. – Startups, newly established and growing small businesses now have a new source of financing backed by the U.S. Small Business Administration as 20 community organizations have been funded by SBA to start making loans up to $200,000 to qualifying small businesses.

Authorized under the Small Business Jobs Act of 2010, the new Intermediary Lending Pilot Program will provide direct loans up to $1 million to 20 community organizations or intermediaries in fiscal year 2011, which in turn will use those funds to help finance small businesses, mostly in underserved markets.

Designed to expand access to capital to small businesses and drive economic growth and job creation, the program will fund 20 additional community lenders in FY 2012.  The program has an additional year of authority in FY 2013 subject to appropriation by Congress.

“The Intermediary Lending Program is an important new tool to support businesses in underserved markets,” said SBA Deputy Administrator Marie Johns.  “Partnering with community lenders will increase points of access to capital for startups and businesses that have been disproportionately affected by the recession.”

One goal of the pilot program over the next two-to-three years is to assess the intermediary model as an effective tool for increasing lower-dollar lending to small businesses and startups, particularly those in traditionally underserved communities.

The first 20 community lending organizations funded by SBA to participate in ILP are:

Organization (Listed in Alphabetical Order)    City, State
Ben Franklin Technology Partners          Philadelphia, PA
Biddeford-Saco Area EDC                           Saco, ME
Business Finance Group, Inc                    Fairfax, VA
Central Minnesota DC                                Andover, MN
Clay-Platte Development Corp.                Kansas City, MO
Colorado Lending Source, Ltd.                 Denver, CO
Cooperative Fund of New England          Amherst, MA
Fresno County EDC                                    Fresno, CA
Grand Central Texas DC                            Austin, TX
Grow South Dakota                                    Sisseton, SD
Mahoning Valley EDC                               Youngstown, OH
NC Minority Support Center                    Durham, NC
Ohio Comm. Dev. Finance Fund            Columbus, OH
Pacific Community Ventures                    San Francisco, CA
PIDC Regional DC                                      Philadelphia, PA
Rural Nevada DC                                          Ely, NV
Seattle Economic Dev. Fund                    Seattle, WA
ShoreBank Enterprise Group                    Ilawco, WA
TELACU Community Capital                    Los Angeles, CA
UP Business Capital                                    Marquette, MI

For more information about the ILP program, visit the program website at http://www.sba.gov/content/intermediary-lending-pilot. To locate your local SBA office, visit www.sba.gov/about-offices-list/2.

For more information about all of the SBA’s programs for small businesses, visit the SBA’s Web site athttp://www.sba.gov.

Already, the Affordable Care Act is providing tax credits of up to 35 percent of employee premium costs, helping small business owners reinvest thousands of dollars to grow their business and create jobs at tax time.

Eligibility for Tax Credits

Generally, tax credits are available for small business owners who:

· Have started or continued health insurance coverage for employees in 2010

· Contribute at least 50 percent of employee premiums at the single coverage rate

· Have fewer than 25 full-time employee equivalents (part-time employees are counted proportionately)

· Pay their employees an average of less than $50,000

The IRS has provided a simple three-step worksheet (below and at www.irs.gov/pub/irs-utl/3_simple_steps.pdf) to help determine your eligibility:

Four million of the nation’s six million small businesses that employ workers could be eligible for these credits. For small businesses, the maximum tax credit is 35 percent of the business’ premium costs, and for small nonprofit organizations, the maximum credit is 25 percent. On Jan. 1, 2014, these rates will increase to 50 percent and 35 percent, respectively. These credits phase out for firms with average wages over $25,000 and for firms with the equivalent of more than 10 full-time employee equivalents.

Effectiveness of Tax Credits to Date

While nearly all firms with more than 200 employees offer health insurance benefits, smaller U.S. firms are much less likely to offer coverage because their premium costs are about 18 percent higher than the same coverage for larger employers. They also have less purchasing power in the health insurance marketplace. Early signs show that these tax credits are stimulating activity in the health insurance market.

A Los Angeles Times report of increased market activity in the small group market at the end of 2010 included three examples of how these tax credits show initial signs of promise:

• UnitedHealth Group (Minnesota) added 75,000 new customers who work for businesses with less than 50 employees
• Coventry Health Care (Maryland), an insurer that focuses on small businesses, signed contracts to cover 115,000 new workers, an increase of 8 percent.
• Blue Cross Blue Shield of Kansas City reported an increase of 58 percent in the number of small businesses buying insurance.

Also, a report from the Lincoln Journal Star in February noted:

• Blue Cross and Blue Shield of Nebraska reported a 34 percent increase in health insurance sales to small businesses for 2011.

In addition, other insurers such as CareFirst Blue Cross Blue Shield of Maryland have announced that they are specifically marketing their products to small businesses due to this credit.

Small businesses themselves have also reported on how these tax credits are helping them provide coverage to employees. Just a few examples from around the country include:

• Mark Hodesh, owner of Downtown Home and Garden in Michigan, was able to claim $15,000 on his tax return this year and hire an additional employee.
• Kiersten Firquain of Bistro Kids in Kansas City was able to start providing coverage to her chefs last year for the first time.
• John and Angela Sweet of Niedlov’s Breadwords in Tennessee had been wanting to offer insurance for some time, and when these tax credits made it more affordable, they “jumped at the opportunity.”

If you are interested in learning more about various health insurance plans that are available in your area, I encourage you to visithttp://finder.healthcare.gov where you can quickly compare them.

2014: Higher Credits and “Exchanges”

In 2014, the tax credits for small employers who provide coverage will increase from 35 percent to 50 percent. At the same time, small business owners should be aware that states will simultaneously roll out small business “exchanges” that will allow employers with less than 50 employees to band together to leverage their collective buying power, reduce administrative costs, and negotiate fairer rates from insurance companies. These exchanges will be available online, and an independent study suggests that they will help reduce costs and increase competitive pressure on insurers, driving down premiums for small businesses by up to 4 percent.

Repeal Efforts

The President supports eliminating a bookkeeping provision that would unfairly burden small businesses. The Administration continues to work with Congress to repeal the expanded 1099 reporting requirement, which is too big of a paperwork burden on small business owners. Repealing the entire law or preventing key provisions from being implemented, however, would hurt small businesses by:

• Raising taxes on up to 4 million small business owners who provide employees with health insurance coverage
• Preventing the formation of a marketplace where insurance companies compete for your hard-earned dollars
• Stifling the ability of entrepreneurs to break out on their own to help America compete in the 21st century

The Affordable Care Act uses market based incentives, such as tax cuts and cost savings, to make quality, affordable health insurance available to all Americans. There is no requirement, mandate, responsibility, penalty or fee of any kind for small businesses with less than 50 workers who choose not to provide insurance, which represents 96 percent of all U.S. firms.

The President has also backed a bipartisan proposal to allow states to implement alternatives to the law beginning in 2014 if those alternatives are able to meet the shared goals of making health insurance affordable and accessible to all Americans, including those with pre-existing conditions.

Instead of re-fighting the battles of the last two years, let’s fix what needs fixing and move forward.

Access to affordable health care is the number-one concern for small businesses across the country. I have worked with many small businesses over the years that are looking at every possible option to offer coverage for their employees, who they often consider to be members of their own family. In 2009, I met a small business owner in New Jersey who said that the day she was able to provide health insurance coverage was the day she knew that her business was a success.

I encourage you to work with your tax adviser, accountant and/or bookkeeper to actively explore the tax credits, exchanges, and other provisions in the Affordable Care Act to help you grow your business and create jobs.

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Are you wondering how health care tax credits will affect your business?

Join SBA’s Web Chat:

Tips on Health Care Tax Credits for Small Biz Owners

Thursday, August 12, 2010, from 10:00 p.m. to 11:00 p.m., Pacific Time

WASHINGTON – The SBA’s Web Chat will highlight small business health care, with a focus on how the Affordable Care Act will benefit small business owners through available tax-saving incentives.  Participants can learn about the newest tax credits they can take advantage of, and additional tax provisions to be implemented during the next several years.

WHO: John Tuzynski, chief of Employment Tax and Specialty Programs for the Small Business Self-Employed (SB/SE) Division at the Internal Revenue Service, will host the August web chat on “Health Care and Small Business.”

WHAT: SBA’s Web chat series provides small business owners with an opportunity to discuss relevant business issues online with experts, industry leaders and successful entrepreneurs.  Chat participants will have direct, real-time access to the Web chats via questions they submit online in advance and during the live session, with instant answers.

WHEN: August 12, 2010, 2010, 1 p.m. ET
Tuzynski will answer questions for one hour.

HOW: Participants can join the live Web chat by going online to www.sba.gov, and clicking “Online Business Chat.”  Web chat participants may post questions before the August 12th chat by visiting http://web.sba.gov/livemeeting/Aug10/ and posting their questions online. To review archives of past Web chats, visit online at http://www.sba.gov/tools/monthlywebchat/index.html

WASHINGTON – The U.S. Small Business Administration issued a scam alert today to small businesses, warning them not to respond to letters falsely claiming to have been sent by the SBA asking for bank account information in order to qualify them for federal tax rebates.

The fraudulent letters were sent out with what appears to be an SBA letterhead to small businesses across the country, advising recipients that they may be eligible for a tax rebate under the Economic Stimulus Act, and that SBA is assessing their eligibility for such a rebate. The letter asks the small business to provide the name of its bank and account number.

These letters have not been sent by or authorized by the SBA, and all small businesses are strongly advised not to respond to them.

The scheme is similar in many ways to e-mail scams often referred to as “phishing” that seek personal data and financial account information that enables another party to access and individual’s bank accounts or to engage in identity theft.

The SBA is working with the SBA Office of Inspector General to investigate this matter. The Office of Inspector General asks that anyone who receives such a letter report it to the OIG Fraud Line at 1 (800) 767-0385, or e-mail at OIGHotline@sba.gov.