Congressman Ron Kind is a Democrat who knows the importance of small business.
Now, he needs to build support for some proposals he is backing in Washington D.C. that could help businessmen in Western Wisconsin and elsewhere.
Kind is pushing proposals to help provide affordable health care, modernize small-business rules and encourage small businesses to provide retirement savings plans for their employees.
He discussed his proposals with about 20 people at a recent La Crosse Area Chamber of Commerce roundtable.
One of Kind’s proposals would allow self-employed people to deduct the cost of health insurance from payroll taxes.
“Because more than 60 percent of the uninsured come from families who are self-employed or who work for small businesses, I have introduced legislation that will make health insurance more affordable for these groups,” Kind said.
“H.R. 3660, the Equity for our Nation’s Self Employed Act would allow the self-employed to deduct the cost of health insurance from payroll taxes. Currently, they are the only group of businesses who are prohibited from taking that deduction. I also plan to introduce new legislation that will provide federal tax incentives and encourage states to harmonize their insurance laws so that small businesses can pool together to purchase health insurance.”
Too many rules for small businesses hamper them in moving forward, Kind said.. “Many of the rules under which S Corporations operate date back nearly half a century,” Kind said on his web site.
“These outdated rules hurt the ability of S Corporations to compete and grow. That is why I introduced H.R. 4840, the S Corporation Modernization Act of 2007, which would ensure the continued success of these businesses by increasing access to capital, making it easier for existing businesses to convert to S Corp status, and encouraging more charitable giving by S Corps.”
Kind also has introduced a bill to make it easier for small businesses to offer IRA and 401(k) retirement plans to employees. The Small Businesses Add Value for Employees (SAVE) Act of 2008 (H.R. 5160) would increase incentives for small businesses to start SIMPLE IRA and 401(k) retirement plans, providing more flexibility and reducing administrative burdens. The bill is co-sponsored by Rep. Kenny Hulshof (R-MO), also a member of the Ways and Means Committee.
“A comfortable retirement is something everyone seeks to achieve – whether they work for a big corporation or a small business,” Rep. Kind said in a press release. “But the majority of small businesses don’t offer any retirement savings plans to employees because it is often a complicated, costly, and a somewhat risky endeavor.
“This bill will actually incentivize small businesses to offer savings plans, allowing workers to accumulate retirement savings and helping small businesses attract and retain employees.”
According to a survey of small businesses conducted by Harris Interactive, only 14 percent of small businesses offer a 401(k) plan and 63 percent do not offer any form of retirement benefits at all.
H.R. 5160 would:
• Offer newly participating employers a tax credit for 50 percent of the start-up costs, and a one-time $25 tax credit for every employee who is enrolled in a savings program.
• Create voluntary automatic IRAs for employers.
• Remove the higher penalty on early SIMPLE IRA distributions.
• Raise the annual contribution limit for SIMPLE plans to the same level as 401(k) plans.
• Allow SIMPLE plan participants to rollover their retirement assets.
Kind voted for the economic stimulus package, but believes the Bush Administration budget will hurt Wisconsin.
“Hopefully it will work,” Kind said of the recently passed economic stimulus plan.
Kind said he hopes the current economic slowdown will not be as long as past slowdowns. He also feels Western Wisconsin will survive the slowdown because the farm economy remains relatively strong.
Putting partisan politics aside, these proposals make sense, and would work primarily within the tax system, rather than necessarily raising taxes for new programs. That’s what most small business people have pushed for, in Western Wisconsin and elsewhere.
