Small Business Recovery Act of 1982

Summary

Small Business Recovery Act of 1982 - Title I: Capital Formation - Amends the Internal Revenue Code to provide for nonrecognition of any long-term capital gain from the sale of property which is reinvested in a small business. Prescribes a three-year statute of limitations for the assessment of any deficiency attributable to gain realized by the sale of such property. Allows an exclusion from gross income of ten percent of the interest received by banks on loans to small businesses. Allows individual taxpayers an income tax credit for investment in small business incentive stock (stock issues aggregating less than $7,500,000 by corporations with equity capital of less than $25,000,000). Limits the amount of such credit to $3,000 ($6,000 for taxpayers filing jointly). Denies such credit to individuals who dispose of incentive stock within six months of purchase, to individuals who control the corporation, and to estates and trusts. Title II: Earnings Retention - Reduces corporate income tax rates for small businesses. Doubles the amount of used investment property purchased by a small business eligible for the investment tax credit. Increases the accumulated earnings credit to permit small businesses to accumulate up to $500,000 of earnings without incurring liability for the tax on accumulated earnings. Title III: Other Tax Benefits - Permits businesses with gross receipts of less than $2,000,000 for the last three preceding taxable years to elect to use the cash method of accounting without regard to inventories. Allows small businesses a nonrefundable income tax credit of $5 for each Federal form or document they are required to file.

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1 official file

• Introduced in House

  summary · EN · 1 October 1982

  Open at official source

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