• Full deductibility of health insurance for self-employed, after a phase-in period, which has been accelerated so that 100 percent deductibility will now be reached in 2003.
   
• Expansion of the Home Office Deduction, saving home-based small business owners an estimated $2.3 billion over the next ten years.
   
• Estate Tax Relief for Family-Owned Farms and Small Businesses - Up to $1.3 million (or $2.6 million with advance spousal estate planning) in qualified family-owned farm and business assets can now be excluded from estate taxes, helping families to maintain their farms and small businesses from generation to generation.
   
• An increase in the amount which a small business can "expense" from $10,000 to $25,000 - Expensining allows small businesses to write ff in the year of purchase the full cost of equipment which would otherwise be depreciated over the life of the asset.
   
• Pension Simplification - It is now much easier for small businesses to provide pensions for both owners and employees without unduly burdensome administrative tests or compliance costs. Such plans are increasingly important to recruit and retain good employees.
   
• General Capital Gains tax Relief - Capital gains tax rates have been reduced from 28 percent to 20 percent (10 percent for those in the 15 percent bracket) on most assets held for at least 18 months. Lower capital gains tax rates encourage investment in small businesses.
   
• Targeted Capital Gains on Small Business Stock - The minimum capital gains tax on qualifying small business stock held for five years or more has been reduced to an effective rate of 14 percent, again encouraging investment in small business.
   
• Capital gains "Rollover" - Capital gains from small business stock held at least six months can now be reinvested tax-free in other small business stock within 60 days, a powerful incentive for investtors to keep their funds invested in small businesses.
   
• Rewarding employers for educating and training their employees, by excluding from their taxable income the expenses for such education and training.
   
• Alternative Minimum tax Relief - More than 2 million small businesses no longer need to calculate the alternative minimum tax, relieving them from complex and needless paperwork.
   
• The IRS Restructuring and Reform Act of 1998, legislation to improve the agency's service to taxpayers and place new emphasis on compliance assistance, not just enforcement.
   
• A newly strengthened Taxpayer Advocate, who can quickly assist taxpayers with problems and dispute resolution where warranted.
   
• The creation within IRS of a Small Business Division, to ensure that small business taxpayers are served by professionals who understand small business isues and problems.

©2001 The Ohio SBDC at Youngstown State University
The Ohio SBDC at Youngstown State University
One University Plaza  •  Youngstown, OH  44555
Office: 330.746.3350  •  Fax:330.746.3324