HB 1074 -- Small Business

Sponsor:  Brandom

This bill changes the laws regarding small business taxation and
establishes the Small Business and Entrepreneurial Growth Act.

SMALL BUSINESS TAXATION

Currently, small businesses that remit their withholding taxes in
a timely manner can retain 2% of $5,000 or less of the total
amount of tax withheld and paid in each calendar year; 1% of
$5,000 to $10,000; and 0.5% of any amount over $10,000.
Beginning January 1, 2010, the bill increases these percentage
amounts by 0.5%.

Corporations will be exempt from income tax if the corporation
does not receive any funds from any programs administered by the
Department of Economic Development.  A corporation must file an
annual exemption request and indicate that the corporation is not
receiving any funds and will not apply to receive any funds from
any department program for five years.  The five-year exemption
period will be renewed each year the corporation files an
exemption request.

SMALL BUSINESS AND ENTREPRENEURIAL GROWTH ACT

The bill establishes the Small Business and Entrepreneurial
Growth Act which allows, beginning January 1, 2010, small
business employers who increase their total payroll by increasing
the number of jobs and meeting certain qualifications to retain
the Missouri withholding tax from the salaries of the newly
created jobs for one year.  If the employer pays more than 50% of
the cost of the premiums for health insurance for all employees,
the withholding tax can be retained for two years.  In either
case, wages for the new jobs must equal or be greater than the
county average wage.  No employer retaining these withholding
taxes will be eligible for benefits under the Quality Jobs Act.

The provisions regarding the exemption from corporate income tax
will expire December 31 six years from the effective date.

Missouri House of Representatives
95th General Assembly, 1st Regular Session
Last Updated November 17, 2009 at 9:26 am