...the Senate, at least when it comes to the small business tax provisions. On these, the House-Senate stimulus compromise looks a lot like the Senate's version—but with less money. On Small Business Administration financing, the conference committee split, in Solomonic fashion. In all, a surprisingly good outcome: as you may recall, the Entrepreneurial Agenda thought that while small firms were better served by the Senate's tax proposals, the House was more thoughtful when it came to SBA lending.

Here's a run-down of the bill that came out of the conference committee, which is likely to get the nod tonight. As usual, we'll start with the tax provisions.

'¢Investment credits: The stimulus will extend generous bonus depreciation terms included in the 2008 stimulus through 2010, and extends accelerated alternative minimum tax or research credits instead of taking bonus depreciation. The bill similarly extends the Section 179 expensing through 2009.

'¢Loss carryback: Businesses, especially medium and large businesses, suffered in the final negotiations over this provision. In the conference report, only small firms can carry back net operating losses to offset earned three to five years ago, and only 2008 losses are eligible. (The original bill allowed special carryback for 2008 and 2009 losses.) However, for the purposes of this section, the Congress has enlarged the definition of small: it includes businesses with up to $15 million in gross receipts.

'¢Lower estimated tax payments: In 2009, individuals with an adjusted gross income under $500,000, of which at least half is derived from a small business, need pay only 90 percent of present-year tax in estimated tax payments. This provision was added by the conference; it didn't appear in either the House or Senate bill.

'¢Work Opportunity Tax Credit: Congress will extend, through 2010, this tax credit for hiring disadvantaged people to include unemployed veterans and unemployed young people who've dropped out of school and lack basic skills.

'¢Repurchasing debt: Generally when a company repurchases its debt, the savings are treated as taxable gross income. The final bill permits firms buying back debt in 2009 or 2010 to spread the income charge over five years, beginning in 2014. Additionally, the bill will waive special deduction limitations for junk debt issued this year.

'¢Exclusion on small business stock gain: Normally, small business owners can exclude half the gain when they sell original stock in the enterprise. For new small business stock issued through 2010, the excluded gain is increased to 75 percent.

'¢S-corp conversions: Normally when a corporation elects "S corporation" status, it has to pay taxes on any gains it earned while still a C corporation ("built-in gains") and realized in its first ten years as an S corporation. Through 2010, S corporations beyond the seventh year of this so-called "built-in gains holding period" get a break: the taxes on realized gains, normally paid at the highest corporate tax rate before being taxed once more on an individual return, are waived entirely.

'¢Industrial development bonds: For the purposes of tax-exempt state and local bonds that finance factories, the bill extends, through 2011, the definition of "manufacturing facilities" to embrace offices that produce intangible property such as patents and copyrights. The bill also treats facilities that support on-site production as "manufacturing" eligible for the bond proceeds.

'¢Transportation fringe benefits: Through 2010, the amount of transit benefits that are excluded from the employee's gross income and payroll wages is increased to $230 a month—the same amount as the employee parking benefit.

We'll follow up later today with the SBA appropriations. Keep watching this space.