Press Releases

House Passes Obama’s $819 Billion Stimulus Package

Micro-Business Receives Modest Benefits from Bill

Washington, D.C., February 2, 2009 – In the first legislative success during his short tenure in office, the U.S. House of Representatives approved President Barack Obama’s sweeping economic stimulus plan, largely along party lines. The bill, the American Recovery and Investment Act of 2009 (H.R. 1), includes $524 billion in spending and $275 billion in tax cuts, among other expenditures.

The two-year plan provides a “Making Work Pay” tax credit of up to $500 for working individuals and $1,000 for working couples, an expansion of the child tax credit and Earned Income Tax Credit, and additional funding for alternative energy research and development efforts. It would also provide over $300 billion in state aid to modernize schools, cover the uninsured and rebuild interstates and bridges.

“I know that there are some who are skeptical of the size and scale of this recovery plan. And I understand that skepticism, given some of the things that have happened in this town in the past,” the president said in a statement on Thursday. “That's why this recovery plan will include unprecedented measures that will allow the American people to hold my administration accountable.”

Additional small business provisions include an extension of small business expensing limits – currently set at $250,000 – through 2009 and a $15 billion provision that would allow businesses to use their losses in 2008 and 2009 to offset profits from five previous years instead of the two allowed under current law. Regardless of President Obama’s appeals to House Republicans, none lent their support; however, there were enough votes by Democrats to ensure the bill’s passage. Previously, three GOP amendments to the package were shelved, including a measure intended to cut individual and business taxes. The House-passed bill will head to the Senate this week where continued debate is expected over additional tax cuts.

The National Association for the Self-Employed (NASE) supported the above small business provisions, however we continue to strongly encourage Congress to include more micro-business focused provisions in the economic stimulus package. NASE recommendations include:

• Making permanent the individual income tax rate cuts from 2001 and 2003;
• The creation of a $1,500 standard home office deduction option;
• Increased funding and improvements to SBA loan programs;
• A self-employment tax deduction on health insurance for sole-proprietors;
• The creation of a health care tax credit for individuals and small businesses.

“The NASE agrees that action must be taken by our government to address this economic crisis,” said Kristie Darien, executive director of the NASE’s legislative office. “However, we feel the economic stimulus packages put forth by Congress and the Administration need to include more substantive provisions assisting America’s smallest businesses, who are the chief industry innovators and job creators in our nation.”