SBA Deadline in South Carolina for Working Capital Loans Due to Excessive Rain is April 28

The U.S. Small Business Administration is reminding small businesses, small agricultural cooperatives, small businesses engaged in aquaculture and most private non-profit organizations of all sizes that April 28, 2014 is the filing deadline for federal economic injury disaster loans in South Carolina as a result of the excessive rain that began on March 1, 2013.

The loans are available in the following counties: Abbeville, Aiken, Allendale, Anderson,
Bamberg, Barnwell, Beaufort, Berkeley, Calhoun, Charleston, Cherokee, Chester, Chesterfield,
Clarendon, Colleton, Darlington, Dillon, Dorchester, Edgefield, Fairfield, Florence, Georgetown,
Greenville, Greenwood, Hampton, Horry, Jasper, Kershaw, Lancaster, Laurens, Lee, Lexington, Marion, Marlboro, McCormick, Newberry, Oconee, Orangeburg, Pickens, Richland, Saluda, Spartanburg, Sumter, Union, Williamsburg and York in South Carolina.

Under this declaration, the SBA’s Economic Injury Disaster Loan program is available to eligible farm-related and nonfarm-related entities that suffered financial losses as a direct result of this disaster. With the exception of aquaculture enterprises, SBA cannot provide disaster loans to agricultural producers, farmers, or ranchers.

The loans are for working capital and can be up to $2 million with interest rates of 4 percent for eligible small businesses and 2.875 percent for non-profit organizations, and terms up to 30 Applicants may apply online using the Electronic Loan Application (ELA) via SBA’s secure
website at https://disasterloan.sba.gov/ela.

Disaster loan information and application forms may also be obtained by calling the SBA’s Customer Service Center at 800-659-2955 (800-877-8339 for the deaf and hard-of-hearing) or by sending an email to disastercustomerservice@sba.gov. Loan applications can be downloaded from the SBA’s website at www.sba.gov/disaster. Completed applications should be mailed to: U.S. Small Business Administration, Processing and Disbursement Center, 14925 Kingsport Road, Fort Worth, TX 76155.

Completed loan applications must be returned to SBA no later than April 28, 2014.

S.C. recognized for business friendly policies.

The Small Business & Entrepreneurship Council ranked South Carolina as one of the nations entrepreneur-friendly states. The index takes a look at 46 different policy measures including an assortment of tax, regulatory, and government spending measures. The Palmetto State was ranked No.14 on the council's annual index of states with the friendliest policies and lowest costs for small business. According to the council, South Carolina earned its ranking for our fairly low individual capital gains tax, no inheritance tax, low consumption- based taxes, low fuel taxes; and a low number of health insurance mandates. However, our 7% personal income tax plus high dividend and interest taxes were listed as negatives, along with high workers compensation costs and a high crime rate.

South Dakota ranked as the councils No. 1 entrepreneur-friendly state followed by Nevada at No. 2; Texas, No. 3; Wyoming, No.4; and Florida, No.5.

In contrast, the states with the least favorable policies include Maine at No. 46; New York at 47, Vermont at 48, New Jersey at 49, and California at No. 50.

"Small businesses are benefiting from policy competition between the states and it is encouraging to see leadership on key issues such as fiscal reform, sensible spending, and tax and regulatory relief." Karen Kerrigan council president  and CEO.

For more information on the Small Business & Entrepreneurship Council click here.

GSA Business: S.C. Ranks 16th in Friendliness Toward Small Businesses

South Carolina ranked No. 16 nationally for friendliness toward small business, according to a recent survey by Thumbtack.com, in partnership with the Ewing Marion Kauffman Foundation.

The Palmetto State received an overall grade of B+, garnering mostly high marks in the two-month survey that involved 6,000 small-business owners nationwide.

Other key findings for South Carolina included:

• It costs relatively little to hire a new employee in South Carolina — the state was the second-least costly place in the nation to hire a new employee. 
• Women-owned small businesses in South Carolina were significantly more optimistic about their financial future than their male counterparts. Female entrepreneurs were 15% more likely than male entrepreneurs to rate their company's financial situation as likely to improve over the coming year. 

The state received a grade of A+ for the ease of starting a small business, cost of hiring a new employee and friendliness of environmental regulations. It received an A for overall regulatory friendliness, and friendliness of employment, labor and hiring regulations.

Read the entire report at GSA Business by clicking here.

HBA of Greenville Succession Planning Education Forum

Succession Planning Education Forum

Who: Your HBA of Greenville is proud to present Jason Freeman of J. Freeman & Associates.  Jason will speak on Succession Planning for your business

What: This program presents an educational class specific to business owners on the topic of Succession Planning.  The seminar will help further the success of your business in the years after you decide to turn it over to a successor.

When: February 14th, 2012 from 8:30 - 9:30 a.m.

Where: Hubbell Lighting

701 Millennium Blvd

Greenville, SC. 29607

How: To register please click here or call (864) 254-0133

THANK YOU TO OUR SPONSORS

Non-government businesses drive South Carolina's economy--the Upstate leads the way

More than 50,000 companies operate in the region's largest markets, representing a combined annual income of nearly $7.8 million. The highest-paid workers are found in the Upstate of South Carolina, with an average wage of more than $57,000 — 41% higher than the national average.

To read the entire article at GSA Business, click here.

Small businesses pay more than large ones to comply with government regulation

According to the Small Business Administration, businesses with fewer than 20 employees pay $2,830 more per employee complying with Federal government regulations than businesses with more than 500 employees. "Small firms don't have the resources in-house to figure out how to comply," says Radwan Saade, a regulatory economist for the SBA's Office of Advocacy.

Read the entire article in the Wall Street Journal by clicking here.

Dispelling Another Internet Rumor

A rumor that is spreading rapidly on the Internet is that the Healthcare legislation that passed Congress earlier this year contains a provision to impose a 3.8 percent sales tax on homes sales. There is a hint of truth to the rumor, but for the most part it is untrue.

The tax being referred to is not a sales tax or a transfer tax, but a tax on certain capital gains, as described below. Some capital gains from the sale of a home could be caught up in the tax, but the rumor exagerates the impact. The vast majority of sales will not be impacted because of the capital gain exemption on a principal residence.

New Tax on Capital Income

Set to take effect in 2013, a tax increase on income from capital gains will affect some real estate investments. However, it will have a negligible impact on sellers of principal residences.

The new 3.8% Medicare tax on so-called unearned income will affect high-income taxpayers who report taxable income due to capital gains and other non-wage income. It will not affect income that is currently tax-exempt, including most capital gains like income resulting from the sale of a principal residence, the result of the $250,000/$500,000 gain exclusion rules. Taxpayers with less than $250,000 in income will not be impacted by the new tax.

Under prior law, Social Security and Medicare benefits are financed by payroll taxes on wages. The tax is equal to 12.4% of covered wages up to a maximum amount of $106,800 in 2010, with half paid by the employer and half paid by the employee; and 2.9% of covered wages uncapped, again with half paid by the employer and half paid by the employee. Self-employed individuals — including independent contractors — generally pay both the employee and employer parts of the tax. Unearned income (e.g. rents, dividends, interest and capital gains) were not subject to these taxes.

As a result of the Patient Protection and Affordable Care Act of 2010, this system is changing. Under revised law, the Medicare tax will increase for taxpayers earning more than $250,000 (if married) or $200,000 (if single). In particular, the individual’s Medicare portion of the tax — which was previously 1.45% or half of the 2.9% — increases to 3.8%, but only for certain income amounts. The rate of 3.8% applies to the smaller of: (1) the amount of income above $250,000/$200,000 of modified adjusted gross income; or (2) net investment income. The tax also applies to self-employed individuals.

Net investment income is the sum of income from interest, dividends, annuities, royalties, rents and capital gain — except income derived from active participation in a trade or business, including sole proprietorships, partnerships and S Corporations.

As noted earlier, tax-exempt unearned income (excluded gain from the sale of a principal residence or interest income allocatable to a tax-exempt bond) is not subject to this new tax.

Here are two examples:

• A couple with wage income of $260,000 and $9,000 in capital gains will pay the extra 3.8% tax on the smaller of $19,000 (the difference between $269,000 and $250,000) and $9,000. $9,000 is smaller, so the increased tax is equal to $342 ($9,000 times 3.8%)
• A couple with wage income of $50,000 and gains income of $210,000 will pay the extra 3.8% tax on the smaller of $10,000 (the difference between $260,000 and $250,000) and $210,000. $10,000 is smaller, so the increased tax is equal to $380 ($10,000 times 3.8%).
  

September 30 is the Deadline for Applying for a Special Small Business Stimulus Loan

Is your business suffering an immediate financial hardship? For example, has your business suffered:

• Declining sales and revenues?
• Difficulty in making loan payments on existing debt?
• Difficulty in paying employees?
• Difficulty in purchasing materials, supplies, or inventory?
• Difficulty in paying rent and/or other operating expenses?

The U.S. Small Business Administration is offering a special deferred payment, interest-free loan for small businesses that have been profitable in the past but are currently suffering a temporary cash-flow problem. The loan program is part of the Federal Economic Stimulus program and expires on September 30.

The loan limit for the ARC Loan program is $35,000.

Two HBA of Greenville banking members have made loans in South Carolina as through the program:

• Carolina First Bank
• Sun Trust Bank

You can find out more about the program, as well start the application process, by visiting:
http://www.sba.gov/recovery/arcloanprogram/REC_ARCLOAN_WHERE.html