Veterans Jobs Opportunity Act

New tax credit for veteran startups

If enacted, veteran or spouse small-business owners would be able to claim a federal tax credit equal to 15% of qualifying start-up costs paid or incurred in a taxable year, up to $50,000 (maximum $7,500 per year). The credit would apply only if the taxpayer elects it, and the election may be made only for the first two taxable years with deductible ordinary and necessary business expenses. To qualify, the business must be owned and controlled by one or more veterans or veteran spouses, have its main place of business in an underserved community, and meet size tests (prior-year gross receipts ≤ $5,000,000 or ≤50 full‑time employees). The Treasury, in consultation with the SBA Administrator, would verify eligibility. If the credit is claimed for property, the property's tax basis is reduced by the credit amount. The credit would be added to the general business credit and the Treasury Inspector General for Tax Administration would evaluate the credit every four years. The changes would apply to taxable years beginning after enactment.