POLITIFACT, October 4, 2012 – At the Presidential Debate on Wednesday, President Obama said he “lowered taxes for small businesses 18 times.” When we examined his claim originally made last summer, we rated it as MOSTLY TRUE.
During a July 6, 2011, question-and-answer session on Twitter, President Barack Obama was asked -- in a tweet by House Speaker John Boehner, R-Ohio -- "After embarking on a record spending binge that left us deeper in debt, where are the jobs?"
Part of Obama’s answer is that his administration has worked to aid small businesses in job creation.
"We have provided at least 16 tax cuts to small businesses who have needed a lot of help and have been struggling -- including, for example, saying zero capital gains taxes on startups -- because our attitude is we want to encourage new companies, young entrepreneurs, to get out there, start their business, without feeling like if they’re successful in the first couple of years that somehow they have to pay taxes, as opposed to putting that money back into their business."
This response echoed a comment we checked a few weeks earlier. In a face-off between the heads of the Republican National Committee and Democratic National Committee on NBC's Meet the Press on June 11, 2011, the discussion turned to what the government should be doing to accelerate job creation.
"I think we need to cut taxes on small businesses," said RNC Chairman Reince Priebus.
"Well, that's good," retorted DNC Chair Rep. Debbie Wasserman Schultz, D-Fla., "because we've done that, 17 times."
Here’s what we found when we looked at the question of small business tax cuts.
When asked for supporting documents, the DNC press office pointed us to a Feb. 25, 2011, posting on the official White House blog titled "Seventeen Small Business Tax Cuts and Counting." The post enumerated 17 small business tax cuts and credits created or extended through legislation signed by Obama.
Eight of them were included in American Recovery and Reinvestment Act (more commonly known as the economic stimulus bill), the Affordable Care Act (also known as the health care law), and the Hiring Incentives to Restore Employment Act (aka the HIRE Act). Among the cuts were the exclusion of up to 75 percent of capital gains on key small business investments; a tax credit for the cost of health insurance for small business employees and new tax credits for hiring Americans out of work for at least two months.
Another eight cuts came via the Small Business Jobs Act, signed by Obama in September of 2010. These included: adding deductions for business cell phone use; creating a new deduction for health care costs for the self-employed; allowing greater deductions for business start-up expenses; eliminating taxes on all capital gains from key small business investments, and raising the small business expense limit to $500,000.
Three months later, the president signed a tax bill that raised the expense limit to 100 percent of small business new investments until the end of 2011. It also extended the elimination of capital gains taxes for small business investments through the end of 2012.
Here's the full list:
From the Recovery Act, HIRE Acts, and Affordable Care Act:
1. A new small business health care tax credit
2. A new tax credit for hiring unemployed workers
3. Bonus depreciation tax incentives to support new investment
4. 75 percent exclusion of small business capital gains
5. Expansion of limits on small business expensing
6. Five-year carryback of net operating losses
7. Reduction of the built-in gains holding period for small businesses from 10 to 7 years to allow small business greater flexibility in their investments
8. Temporary small business estimated tax payment relief to allow small businesses to keep needed cash on hand
From the Small Business Jobs Act:
9. Zero capital gains taxes on key investments in small businesses
10. Raising the small business expensing to $500,000
11. An extension of 50 percent bonus depreciation
12. A new deduction for health care expenses for the self-employed
13. Tax relief and simplification for cell phone deductions
14. An increase in the deduction for entrepreneurs’ start-up expenses
15. A five-year carryback of general business credits
16. Limitations on penalties for errors in tax reporting that disproportionately affect small business
From the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act:
17. 100 percent expensing
On balance, we rated Wasserman Schultz's comment Mostly True. Because Obama’s comment is substantially similar, we also rate his comment MOSTLY TRUE.
Posted By: Richard Kigel
Friday, October 5th 2012 at 12:47PM
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