Small Biz Tax ReliefLarry Kanter
Entrepreneurs can scratch at least one item off their legislative wish list. Last month, on the final day of the 106th Congress, the House and Senate finally repealed a relatively obscure tax law that nonetheless has been a major nuisance for small-business owners. The provision required that taxes on most business sales be paid up front, even if payments were to be received in installments over several years. President Clinton signed the legislation on Dec. 28.
The law, passed in late '99, killed or stalled thousands of business sales last year because few entrepreneurs have enough cash to pay a big tax bill all at once. Business owners can now return to the accrual method, in which capital-gains taxes are paid in installments as payments are received. Let the deal-making begin.