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(Washington D.C.)- Congressman Sander Levin introduced legislation today to eliminate capital gains tax on investments in qualified small business stock during 2010. The proposal was included in President Obama’s 2010 budget and reiterated as part of a jobs package in his speech today at the Brookings Institute. The legislation would build on the Recovery Act, which included a 75% exclusion from capital gains tax for qualified investments in 2009 and 2010.
“Too many small businesses are struggling to obtain access to capital in the current environment,” said Rep. Levin. “We have to continue to find ways to encourage banks to make more loans, but equity financing is also part of the solution. Many small businesses are ready to make investments and create jobs, but cannot access needed capital.”
This legislation would expand the capital gains exclusion for qualified small business stock to 100% and eliminate the applicability of the AMT for such stock acquired in 2010. This will provide a strong incentive for timely equity investments in qualified small businesses.
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