COCHRAN COSPONSORS SMALL BUSINESS JUMP START ACT

Legislation Doubles Federal Tax Deduction for Initial Start-up Expenses

WASHINGTON, D.C. – U.S. Senator Thad Cochran today announced his support for legislation that would allow new small business owners to deduct up to $10,000 of their initial start-up costs.

Cochran is cosponsoring the Small Business Jump Start Act (S.1402), a bipartisan measure that would double the federal tax deduction, from the current $5,000 to $10,000, for first-year small business start-up expenses.

“The ongoing national recession is taking its toll on small business growth and job creation in Mississippi, which only makes it more difficult for small business owners to survive the critical first years of operation,” Cochran said.  “I think the expanded tax deduction outlined in this legislation could be pivotal for the entrepreneurs who launch a small business today.”

S.1402 would amend the Internal Revenue Code (Section 195 – Start-up Expenditures) to expand the start-up deduction for expenses incurred in taxable years beginning in 2009, 2010 or 2011.  To increase the benefit of the start-up deduction, the bill also sets a new $60,000 threshold, up from $50,000, before the deduction begins to be phased out. 

The legislation, which has been referred to the Senate Finance Committee, was introduced by Senators Jeff Merkley (D-Ore.) and Lamar Alexander (R-Tenn.).  It has been endorsed by the U.S. Chamber of Commerce, the National Federation of Independent Businesses, National Small Business Association and the National Association of the Self-Employed.

            As a small business advocate, Cochran has used his position as the ranking Republican member on the Senate Appropriations Committee to support small business development activities in Mississippi.  Earlier this month, he secured Senate Appropriations Committee approval for Small Business Administration funding in FY2010 for several university-led business development programs in the state.

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