While nearly two-thirds of the newly-adopted $787 billion economic stimulus package represents spending programs, the other third (about $288 billion) offers tax breaks for individuals and businesses. According to CBIZ, a major accounting firm and business services provider, small biz bagged some of the biggest benefits under the new law.
Some tax goodies extend popular incentives that recently expired. Others expand tax write-offs for losses — which will generate quick cash for many business owners. Here’s a rundown of key business tax benefits included in the stimulus bill:
1) Longer operating loss carry-backs: If your small business had a “net operating loss” (NOL) in 2008, this provision could be a terrific way to generate cash by claiming refunds now of taxes paid in previous years when profits were flowing. Instead of the current two-year carry-back period, eligible businesses (those averaging less than $15 million in gross receipts) can now carry back 2008 losses to 2003, 2004 or 2005. And you don’t have to be a corporation or LLC. Even sole proprietors can qualify. If your business had a loss last year, CBIZ suggests filing your 2008 return early so you can then file amended returns for prior years and reclaim your cash.
2) Bonus depreciation extended: In a bid to boost new equipment purchases (computers, machinery, vehicles) “Bonus Depreciation” - a juicy tax tidbit that expired in 2008 - has been extended through 2009 for most property, and 2010 for longer-lived assets. Basically, this is a 50 percent “bonus” write-off for the cost of new equipment a business buys and starts using this year.
Say you spend $100,000 on new computers, software and other IT equipment. Under prior rules, your first year depreciation write-off would be 14 percent ($14,000). But now you can get a 50 percent “bonus depreciation” ($50,000), plus 14 percent of the remaining amount (another $7,000). Thus, you’d net a total first-year deduction of $57,000 on the $100,000 purchase. This applies to businesses of all sizes that invest in tangible property or computer software, as well as improvements to leased property.
3) Bigger expensing write-offs for depreciable property: Higher expensing limits for depreciable property that expired in ‘08 have also been extended through ‘09. This lets your business immediately write off up to $250,000 of tangible personal property placed in service this year.
“The tax benefits of leveraging these two provisions can be tremendous” say CBIZ experts. You can quickly recover the cost of major asset purchases. But the provisions might not be around for long, so moving up equipment purchases to get the tax benefits now might make sense. Be sure to check with your tax advisor about state tax provisions since not all states conform to the federal bonus deprecation provisions.
4) Estimated tax relief: If you report income from a small business on your personal tax return, you’ll get a small break on the amount of estimated taxes required to avoid underpayment penalties. If at least 50 percent of your adjusted gross income is from the business, you’ll only need to cover 90 percent of your prior year’s taxes to avoid penalty, beginning with the 2009 tax year. Previously this was 100 percent to 110 percent, depending on your income.
5) Small biz stock gains: Anyone who buys stock in a small business between the enactment date of the stimulus bill and 2011 gets a bulked-up break on capital gains taxes later on. If the stock is held at least five years, 75 percent of any gain can be excluded - up from the current 50 percent. According to CBIZ, the stock must be original issue stock held by a non-corporate investor in a C corporation with gross assets under $50 million. The company must also be actively engaged in a trade or business.
6) Tax breaks for hiring: The new law expands the Work Opportunity Tax Credit (WOTC) program to include two new targeted groups - unemployed vets and young people between 16 and 25 who haven’t been employed or attended school in the past six months. Businesses hiring such individuals can qualify for a $2,400 tax credit per worker.
Saturday, August 22, 2009
OPEC
OPEC Member Countries have embarked upon substantial investments, both upstream and downstream, to ensure that the world economy benefits from regular and secure oil supplies. OPEC Crude oil production capacity (excluding Iraq) is projected to increase to around 36.9 mb/d by 2010 from 31.7 mb/d in 2005.
In addition, Iraq’s recovery should contribute significantly to raising OPEC’s overall production capacity.
OPEC has embarked upon significant expansion plans to increase its capacity to ensure that the world economy benefits from regular and secure oil supplies.
In the medium term, over 100 projects, with an overall estimated cost of some $120 billion are being undertaken by OPEC Member Countries (excluding Iraq). These projects are in addition to all energy infrastructure projects, such as pipelines, export terminals and downstream expansion.
In addition, Iraq’s recovery should contribute significantly to raising OPEC’s overall production capacity.
OPEC has embarked upon significant expansion plans to increase its capacity to ensure that the world economy benefits from regular and secure oil supplies.
In the medium term, over 100 projects, with an overall estimated cost of some $120 billion are being undertaken by OPEC Member Countries (excluding Iraq). These projects are in addition to all energy infrastructure projects, such as pipelines, export terminals and downstream expansion.
oil rises
The price of US crude rose to $74.15 a barrel before settling at $73.89, a gain of 98 cents. London Brent was up 86 cents at $74.19.
The oil price hit $147 a barrel last July and fell below $74 last October, a level it has not breached since.
Worldwide oil prices have been extremely volatile this year.
Prices have been affected as much by sentiment as by fundamentals of demand and supply.
Ben Bernanke, the chairman of the Federal Reserve, said that prospects for a return to growth in the near term appeared good in the US and abroad.
US shares traded higher - with the Dow Jones index rising 1.7% to 9,506 - after Mr Bernanke's speech and on better-than-expected figures for sales of existing homes.
Sales rose by 7.2% in July to an annual rate of 5.24 million homes.
The significant rise in the oil price in the first half of the year is due in large part to a recovery in investment by financial investors, said Eugen Weinberg at Commerzbank.
The oil price hit $147 a barrel last July and fell below $74 last October, a level it has not breached since.
Worldwide oil prices have been extremely volatile this year.
Prices have been affected as much by sentiment as by fundamentals of demand and supply.
Ben Bernanke, the chairman of the Federal Reserve, said that prospects for a return to growth in the near term appeared good in the US and abroad.
US shares traded higher - with the Dow Jones index rising 1.7% to 9,506 - after Mr Bernanke's speech and on better-than-expected figures for sales of existing homes.
Sales rose by 7.2% in July to an annual rate of 5.24 million homes.
The significant rise in the oil price in the first half of the year is due in large part to a recovery in investment by financial investors, said Eugen Weinberg at Commerzbank.
US markets
"The prospects for a return to growth in the near term appear good," Mr Bernanke told a conference in Wyoming.
On Wall Street, the Dow Jones index rose more than 1%, while European markets were also sent higher.
But the Fed boss said unemployment, which is expected to top 10% in the US, would fall "only gradually".
However, European Central Bank president Jean-Claude Trichet expressed concern at what he saw as premature talk of a full recovery
Central bankers were speaking as data showed sales of existing US homes rose by more than 7% in July.
That was the largest monthly increase in the 10 years that the National Association of Realtors has been keeping records.
But Mr Bernanke warned that the road to recovery would be a long one.
"The economic recovery is likely to be relatively slow at first, with unemployment declining only gradually from high levels," he said.
The International Monetary Fund (IMF) has predicted that the US economy will expand by 0.75% next year, after earlier predicting no growth.
The Fed chief was also upbeat on the prospects for the world economy.
"After contracting sharply over the past year, economic activity appears to be levelling out, both in the United States and abroad," he said.
The IMF has previously said that the global economy was "starting to pull out of recession".
'Bullish'
The Dow Jones finished 156 points higher at 9,506. The Nasdaq and the S&P 500 also rose by more than 1%.
London's FTSE 100 climbed 2% to close at 4,851, while Germany's Dax index rose 2.8% and France's Cac 40 gained 3.1%.
"Bernanke was a little bit more bullish than most people were expecting," said Jacob Oubina, currency strategist at Forex.com.
"He's saying that the global economy is starting to emerge from the recession and that the fears of a financial collapse have receded substantially.
"I think the market is just taking those headlines as extreme positives for the outlook."
On Wall Street, the Dow Jones index rose more than 1%, while European markets were also sent higher.
But the Fed boss said unemployment, which is expected to top 10% in the US, would fall "only gradually".
However, European Central Bank president Jean-Claude Trichet expressed concern at what he saw as premature talk of a full recovery
Central bankers were speaking as data showed sales of existing US homes rose by more than 7% in July.
That was the largest monthly increase in the 10 years that the National Association of Realtors has been keeping records.
But Mr Bernanke warned that the road to recovery would be a long one.
"The economic recovery is likely to be relatively slow at first, with unemployment declining only gradually from high levels," he said.
The International Monetary Fund (IMF) has predicted that the US economy will expand by 0.75% next year, after earlier predicting no growth.
The Fed chief was also upbeat on the prospects for the world economy.
"After contracting sharply over the past year, economic activity appears to be levelling out, both in the United States and abroad," he said.
The IMF has previously said that the global economy was "starting to pull out of recession".
'Bullish'
The Dow Jones finished 156 points higher at 9,506. The Nasdaq and the S&P 500 also rose by more than 1%.
London's FTSE 100 climbed 2% to close at 4,851, while Germany's Dax index rose 2.8% and France's Cac 40 gained 3.1%.
"Bernanke was a little bit more bullish than most people were expecting," said Jacob Oubina, currency strategist at Forex.com.
"He's saying that the global economy is starting to emerge from the recession and that the fears of a financial collapse have receded substantially.
"I think the market is just taking those headlines as extreme positives for the outlook."
Tuesday, August 18, 2009
bse today
The BSE benchmark index Sensex rose by 61pnts in opening trade on 8/19/09 on selective buying by funds as well as investors in line with overnight gains in the American market.
The 30-share BSE barometer gained 61 pnts at 15,096 in trade.
Brokers said selective buying by foreign funds and retail investors in realty, metals and banking sectors helped Sensex post gains.
Overnight gains in the US stock market also influenced the trading sentiments to some extent, they added.
The 30-share BSE barometer gained 61 pnts at 15,096 in trade.
Brokers said selective buying by foreign funds and retail investors in realty, metals and banking sectors helped Sensex post gains.
Overnight gains in the US stock market also influenced the trading sentiments to some extent, they added.
Sunday, August 16, 2009
US bankruptcies soar to 1.3m in just 12 months
NEW YORK: The number of bankruptcies in the US skyrocketed to 1.31 million for the year ended June 2009, with over 85% of the filing taking place
since September last year.
Reeling under the worst financial turmoil in nearly 80 years, the count of bankruptcies till June this year, is 35% higher than the same period a year ago.
The bankruptcies stood at just 967,831 for the year ended June 30, 2008, according to the Administrative Office of the US Courts.
Since September 2008 -- the month when the famed financial services major Lehman Brothers went belly up -- the number of bankruptcies till June stood at 1.1 million.
"Non-business filings for the 12-month period ending June 30, 2009 totalled 1,251,294, up 34% from 934,009 non- business filings for June 30, 2008," the Administrative Office said in a recent statement.
Reflecting the severity of the financial situation, bankruptcy filings by businesses during the same period soared 63% to 55,021 for the year ended June 2009, compared to the year-ago period.
In the last 11 months, America has seen the collapse of many a well known names such as banking entity Washington Mutual and car makers -- General Motors and Chrysler. However, the two auto makers have emerged out of bankruptcy protection as leaner companies.
since September last year.
Reeling under the worst financial turmoil in nearly 80 years, the count of bankruptcies till June this year, is 35% higher than the same period a year ago.
The bankruptcies stood at just 967,831 for the year ended June 30, 2008, according to the Administrative Office of the US Courts.
Since September 2008 -- the month when the famed financial services major Lehman Brothers went belly up -- the number of bankruptcies till June stood at 1.1 million.
"Non-business filings for the 12-month period ending June 30, 2009 totalled 1,251,294, up 34% from 934,009 non- business filings for June 30, 2008," the Administrative Office said in a recent statement.
Reflecting the severity of the financial situation, bankruptcy filings by businesses during the same period soared 63% to 55,021 for the year ended June 2009, compared to the year-ago period.
In the last 11 months, America has seen the collapse of many a well known names such as banking entity Washington Mutual and car makers -- General Motors and Chrysler. However, the two auto makers have emerged out of bankruptcy protection as leaner companies.
OIL PRICES HIGH
SINGAPORE: Crude prices slid further in Asian trade today as markets reacted to falling consumer confidence in the United States, analysts said.
New York's main futures contract, light sweet crude for delivery in September, shed 56 cents to $66.95 a barrel in early trade from its close on Friday.
Brent North Sea crude for October delivery fell 44 cents to $71.00.
Prices continued moving downwards as data released by the University of Michigan on Friday showed an unexpected fall in consumer sentiment, which spooked the commodities and equities markets, analysts said.
"The report showed a drop in consumer confidence and that weighed on the oil market. The oil market was also pressured by the falling stock markets," said Victor Shum, senior principal of Purvin and Gertz energy consultants in Singapore.
The report stated that its consumer sentiment index dipped to a preliminary 63.2 from 66.0 in August, confounding most analysts who had expected it to rise to 69.0 and raising further red flags on consumer spending, the main driver of the US economy.
Shum added that weak oil fundamentals would continue to put a peg on crude prices.
"Given the very weak oil market fundamentals, the mid-60s to high-60s is about the right range. The path of least resistance is down," he said.
(BUSINESS THE TOI)
New York's main futures contract, light sweet crude for delivery in September, shed 56 cents to $66.95 a barrel in early trade from its close on Friday.
Brent North Sea crude for October delivery fell 44 cents to $71.00.
Prices continued moving downwards as data released by the University of Michigan on Friday showed an unexpected fall in consumer sentiment, which spooked the commodities and equities markets, analysts said.
"The report showed a drop in consumer confidence and that weighed on the oil market. The oil market was also pressured by the falling stock markets," said Victor Shum, senior principal of Purvin and Gertz energy consultants in Singapore.
The report stated that its consumer sentiment index dipped to a preliminary 63.2 from 66.0 in August, confounding most analysts who had expected it to rise to 69.0 and raising further red flags on consumer spending, the main driver of the US economy.
Shum added that weak oil fundamentals would continue to put a peg on crude prices.
"Given the very weak oil market fundamentals, the mid-60s to high-60s is about the right range. The path of least resistance is down," he said.
(BUSINESS THE TOI)
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