Henry Cuellar for Congress | Proven Leadership for Texas

Standing Up for Small Business

 

As a former small business owner, Congressman Cuellar understands the stakes small businesses face today. That's why he's help take unprecedented action in Congress to provide small businesses with extensive tax cuts, financial assistances, small business loans, tax credits and other incentives to level the playing field for small businesses in these tough economic times. Congressman Cuellar values the role small businesses play in the nation's economy and understands how vital they are to employing Texas and the rest of the country.

 

Last year, the American Recovery & Reinvestment Act passed by Congress provided to the nation's small businesses and thousands of smaller employers in Texas vitally important new tax cuts. Overall, the American Recovery and Reinvestment Act will have a significant impact on small businesses by providing to independent employers tax cuts, tax incentives and financing opportunities that will help them create jobs. Since last year, Congress has helped the Small Business Administration get credit flowing to small businesses, making it easier and less expensive for small businesses to get loans. In fact, the Small Business Administration estimates reports that this initiative supported over $2.8 billion in small business lending. Building on this initiative, in 2010 Congressman Cuellar helped pass additional legislation that provides over $50 million in small businesses tax cuts and credits, through health care reform and jobs growth initiatives, also known as the HIRE Act. 

 

Tax Cuts for Small Businesses 

 

Congressman Cuellar helped pass in 2009 and 2010, the following small business tax incentives to create jobs and spur investment. These vitally important tax cuts help invest in American businesses here at home:

 

Bonus Depreciation:  Helps businesses quickly recover costs of new capital investments by extending the 

increased bonus depreciation for businesses making investments in new plants and equipment in 2009.  

 

Buying Back Debt: Provides assistance to companies looking to reduce their debt burdens by delaying the 

tax on businesses that have discharged indebtedness, which will help these companies strengthen their 

balance sheets and obtain resources to invest in job creation.  

 

Small Business Expensing:  Spurs small business investment by extending increased small business 

expensing, which doubles the amount small businesses can immediately write off for capital investments 

and purchases of new equipment made in 2009 from $125,000 to $250,000.  This write off phases out 

completely for investments over $800,000 (up from $500,000). 

 

Small Business Loss Carrybacks:  Increases cash flow for small businesses by providing a 5-year carryback  of net operating losses (NOLs).  This would allow small businesses (with gross receipts of less than $15 

million) to write off losses incurred in 2008 against taxes assessed over the previous five years (current law 

limits NOL carryback to the previous two years). 

 

Small Business Investment:  Spurs investments in small businesses by cutting the capital gain tax (by 

increasing from 50 percent to 75 percent the capital gains that are excluded from tax) for investors in small 

businesses who buy stock (in the next two years) and hold it for more than five years.   

 

3% Government Withholding:  Delays the mandate that federal, state, and local governments withhold 3 

percent of payments to businesses for goods and services, which is supported by the National Small 

Business Association. 

 

Jobs for Unemployment Veterans or Youth:  Encourages new job creation with business tax credits for 

hiring recently discharged unemployed veterans and youth that have been out of work and out of school for 

the 6 months prior to hire.  

 

$40 billion in Health Care Tax Cuts: Health Care Reform provides a sliding scale tax credit to small businesses with fewer than 25 employees and average annual wages of $50,000 or less that purchase health insurance for employees.  The full credit will be available to employers with 10 or fewer employees and average annual wages of $25,000 or less.  To be eligible for a tax credit, 

the employer must contribute at least 50% of the total premium cost.  

 

Immediate Tax Cuts: The small business tax credits in health care reform begin immediately in 2010.  For 2010 through 2013, eligible employers will receive a small business tax credit for up to 35% of the employee’s premium. For 2014 and later, once the Health Insurance Exchanges are up and running beginning in 2014, eligible employers who purchase coverage through the Exchange for their employees can receive a tax credit for two years of up to 50% of the employee’s premium.  

 

60% of Small Business Qualify: The estimates are that 60% of America’s businesses will qualify for these small business tax credits under health care reform. 

 

Premium Assistance Tax Credits:  Effective in 2014, for those with access to the Exchange, sliding scale tax 

credits are provided to individuals and families up to 400% of poverty.  That means that the tax credits phase 

out completely for an individual with $43,320 in income and a family of four with $88,200 in income. 

 

 

Leveling the Playing Field For Small Business

 

Congressman Cuellar believes that we need to level the playing field for the nation's small businesses by giving them fair access to credit, resources, loans and assistance as are offered to larger firms today. That's why Congressman Cuellar helped pass health care reform because it provides small businesses the same access to quality, affordable health care coverage the larger businesses have today. 

 

Beginning in 2014, small businesses across Texas can participate in a state based health insurance exchange to band together and purchase health insurance for their employees at rates only extended to larger firms today. In Texas, insurance premiums have doubled over the past decade and increasingly the number of small businesses who can afford insurance for their employees is decreasing at an alarming rate. Plus, tax credits will make coverage affordable for many small business employees. 

 

Many of the small business employees who do not receive insurance through their employer and are on the Exchange will have access to sliding‐scale tax credits to help them pay their premiums.  These tax credits will help many small business employees who currently find health coverage simply unaffordable finally be able to purchase coverage for themselves and their families. 

 

 

Real Action at the State Level 

 

For 14 years in the Texas State House, as a State Representative and Texas Secretary of State, Henry Cuellar supported small businesses as the backbone of the Texas economy. Small businesses create the majority of our jobs in our congressional district. As a State Representative, Henry Cuellar has been a champion of small business, by authoring and sponsoring legislation that:

• passed the largest tax-cut in Texas history that helps small businesses
• sanctioned frivolous lawsuits to protect small businesses
• updated the Fraudulent Transfer Act to modernize the law and prevent fraud in business transactions
• established a School of International Trade at Texas A&M International University to educate young business people to engage in international commerce
• established economic centers at several universities to study border economics and business development; established the first border port authority to facilitate international commerce
• established the “International Trade Awareness Week” in May to emphasize the importance of international commerce
• encouraged the State Board of Education to develop a curriculum of international studies and foreign languages in our public schools
• promoted tourism to help small businesses
• established foreign trade offices to improve trade between Texas and Mexico and other countries
• established the Texas Exporters Loan Fund to help small businesses expand their markets to other countries
• reduced and simplified paperwork to make it easier to deal with state agencies
• helped disadvantaged small businesses get more state contracts
• established the Texas Academy of Foreign Languages to help small businesses and students learn foreign languages and culture to better engage in international trade
• established the Regional Import/Export Training Center at Laredo Community College to train workforce in international trade
• created a license for the storage of imported beer, ale, and malt liquor to create jobs in Texas instead of other states
• directed higher education programs to help with small business research and development to create more jobs
• directed each state agency to review and delete all of its unnecessary and burdensome rules to make easier to deal with state government
• strengthened the career and technology education programs offered by public schools districts to develop a better workforce
• provided more funding for adult education to better prepare the workforce
• established a Ph. D program in business at Texas A&M International University to further educate business students
• created annual three-day, back to school “sales tax holiday”
• eliminated sales tax on internet charges and on 20% of data processing and information services
• created a small business exemption from corporate franchise tax
• provided corporations with tax credits for research and development, day-care expenses, after school programs, and job creation

Small Businesses Endorsements 

Henry Cuellar’s advocacy for small businesses has been recognized by Texas Chamber of Commerce, the Texas Association of Colleges and Technical Educators, the Laredo Chamber of Commerce, the Texas Career Institute, the City of Laredo and Cigarroa High School Arts Tech Program, the Laredo Association of Human Resource Management, Texas A&M International 5th Annual Conference Western Universities, the Laredo Business and Professional Women’s Association, the Texas U.S. Customs Brokers Association, the Free Enterprise Public Action Committee and Free Market Committee, the Laredo Development Foundation, the Texas Association of Mexican American Chamber of Commerce (TAMACC), the Texas Economic Development Commission, and the Laredo Mexican American Chamber of Commerce.