Happy Anniversary Startup America: Obama Introduces Startup Legislation
Jan 31, 2012
Today marks the one year anniversary of Startup America. To mark the occasion, there are 14 different regional events happening, the first being a Startup Virginia early breakfast meeting with Steve Case and Aneesh Chopra, and more, which is happening right down the street in Arlington, Virginia (we attended).
Other events will include a startup fair in Iowa, the launch of Startup Maryland, Vermont and Missouri, an idea summit for Startup DC, a fireside chat in Boston for Startup Massachusetts, anniversary events for Startup Illinois and Startup Florida, and more.
While for some of these states or regions, participation in Startup America will be more symbolic than anything else, the partnership has encouraged real grassroots action and engaged with many large companies that can help smaller companies along the way.
Perhaps most importantly, President Obama, Chairman Steve Case and other high-profile supporters have used the platform to encourage Congress to pass legislation aimed at jumpstarting more startups and high-potential small businesses in an effort to create jobs and grow the economy.
Part of Obama’s 2013 budget proposal, the legislation would enable new tax breaks, crowd funding opportunities and allow for high-skill immigration. Despite the hostile political environment in this election year, the package is expected to have bipartisan support, as it includes proposals in the Senate by Democrat Chris Coons of Delaware and Republican Marco Rubio of Florida (the AGREE Act), and another plan by Republican Jerry Moran of Kansas and Democrat Mark Warner of Virginia (the Startup Act), which was heavily based on research produced or funded by the Ewing Marion Kauffman Foundation that found that companies less than five years old were responsible for nearly all of the net jobs created in the United States between 1980 and 2005.
White House officials say President Barack Obama will call on Congress on Tuesday to pass legislation that, among other measures, would eliminate tax rates on capital gains for investments in small businesses and extend for a year the ability of all businesses to immediately deduct all of the costs of equipment and software purchases.
If enacted, The AGREE Act and the Startup Act could do the following:
- 10 percent tax credit for small business that add jobs or increase wages in 2012
- Provide a three year extension of 100 percent bonus depreciation for the full cost of qualified investments such as equipment and property.
- Provide a three year extension of Section 179 expensing levels for small businesses.
- Provide a three year extension of eliminated taxes on certain small business stock.
- Extend the Research & Development tax credit until 2013, increase the Alternative Simplified Credit (ASC) from 14 percent to 20 percent, and makes the ASC permanent.
- Establish an enhanced research credit for domestic manufacturers to encourage job creation at home.
- Provide veterans with a tax credit equal to 25% of the fee associated with starting a franchise up to $100,000.
- Provide a five-year exemption from Section 404(b) of Sarbanes-Oxley for the first five years of a company going public, or for those below $250 million in total gross revenue (whichever comes first).
- Eliminate the per-country numerical limitation for employment-based immigrant visas and adjusts the limitations on family based visa petitions from 7% per country to 15%.
- Protect intellectual property by clarifying the Trade Secrets Act, and making it explicitly clear that it is not a crime for federal officials, in the performance of their duties, to share information about suspected infringing products with the right holder of a trademarked good.
- Allow for entrepreneur visas and green cards with diplomas for STEM degrees
- Facilitate early stage financing of startups (Capital Gaines tax exemptions for long held startup investments, tax incentives for startup operating capital)
- Facilitate access to public markets
- Shareholders of companies with market cap below $1billion would be “opt-in” under Sarbanes Oxley Act
- Differential patent fees to reduce the patent backlog
- Licensing freedom for academic innovators
- Automatic 10 year sunsets for all major rules
- Assessments of state/local startup and business policies
“The president has made small businesses and particularly startups a key aspect of his economic growth agenda because he understands how much the newest and fastest-growing small businesses drive job growth in our economy,” said Gene Sperling, director of the White House National Economic Council.
Tech Cocktail is proud to be a part of the launch of Startup DC and are excited to see how this partnership can make a difference in the DC area and around the country. If you are an entrepreneur or run a startup you can go here to become a Startup America member.
Watch Scott Case, CEO of Startup America, and President Obama talk about the Startup America Partnership.