Crain's NY article features June Klein and Technology & Markeitng Ventures, INc.
1 like372 views
The document discusses a proposal by June and Ira Klein to create a marketplace where small businesses could sell unused federal tax deductions for equipment purchases. The Kleins argue this would provide cash for small businesses that are unprofitable in early years and cannot take the full deduction. However, a tax expert believes the proposal could reduce government tax revenue if large profitable companies buy the deductions. Supporters argue the lost revenue would be minor compared to existing small business programs. The Kleins are working to build support for the proposal among politicians and business groups in New York and Connecticut.
![VOL. XXVII, NO. 19 WWW.CRAINSNEWYORK.COM MAY 9-15, 2011 PRICE: $3.00
Small businesses, especially
startups, often wont be profitable for
years. But they still have to invest in
such things as manufacturing tools
and computers. Though the federal
government offers a substantial tax
deduction for equipment purchases,
businesses that operate at a lossand
thus dont owe any taxeslose the
deduction for that year.
JuneR.Kleinandherhusband,Ira
Klein, would like that to change. They
are pushing for federal legislators to
propose a law that would create a
marketplace where a small business
could sell deductions it cant use.
Connecting buyers, sellers
A small-business owner herself,
Ms. Klein is CEO of Technology
& Marketing Ventures Inc., a
Manhattan-based consulting firm.
Mr. Klein is a tax attorney and general
counsel for his wifes firm.
TheKleinsenvisionamarketplace
that would connect buyers and sellers
and would determine the value of
equipment-depreciation deductions
through a bidding process.
The mechanism would be similar
to that for tax benefit transfer leases,
which were developed during the
recession of the early 1980s. The
leases let owners sell equipment-
depreciation deductions, though not
in an auction-like setting.
Most small businesses didnt
take advantage of TBT leases because
of their complexity and the legal
costs, said Mr. Klein, who helped
craft the details of those leases. The
authorizing law was repealed in 1983,
he added, as large companies were the
primary beneficiaries of the leases.
The Kleins insist that a tax
benefit exchange would be simpler
and would boost small companies by
giving them cash for a deduction they
cant use immediately.
Income balancing
Sara Horowitz, founder and
executive director of the Freelancers
Union, based in Brooklyn, thinks
the exchange could help freelancers.
Anything that allows them to
even out their income over time is a
good thing, she said.
TheKleinsareworkingonbuilding
local support for the initiative. In
March, Ms. Klein gave the proposal
to Nancy Ploeger, president of the
Manhattan Chamber of Commerce,
and to Sen. Kirsten Gillibrands staff
in New York. They have also sent it
to Rep. John Larson, a Connecticut
Democrat on the House Ways and
Means Committee. The senators
office is reviewing it; Mr. Larsons has
not yet done so.
The Kleins argue that their
proposed law wouldnt cost the U.S.
Treasury anything and wouldnt affect
the deficit, because depreciation
deductions are already scored
in the deficit calculations by the
Congressional Budget Office.
But that representation isnt
accurate, according to Sandy Botkin,
president of the Tax Reduction
Institute and author of Lower Your
TaxesBig Time!.
If a firm in the top bracket
buys the depreciation, it will get an
immediate reduction in taxes and the
government loses revenue, [perhaps]
a substantial amount, said Mr.
Botkin, also a former IRS attorney. I
think that will make this a loser in
Congress. They are looking for ways
to balance the budget, and this isnt
going to help them do that.
Ms. Ploeger thinks the proposal
has legs, however.
President Obama has put a
lot of money into funding Small
Business Administration programs,
and if this is another way to [do that],
we should, she said. If you add up
all the monies our government is
already spending on small-business
support$30 billion here, $50 billion
therethe loss will be a drop in the
bucket.
BY: EILENE ZIMMERMAN
Proposal would
create a cash market
for unusable
depreciation breaks
Promoters of
a bill insist the
cost is already
accounted for
SOLD: June and Ira Klein are gathering support for the auction-like mechanism they envision.
444 E 82ND ST NY, NY 10028 USA
the-5th-estate.com
jklein@tmv.com
T:212.628.2178 F:212.744.2089](https://image.slidesharecdn.com/tmvcrainsarticlev3-140325213720-phpapp01/85/Crain-s-NY-article-features-June-Klein-and-Technology-Markeitng-Ventures-INc-1-320.jpg)
Crain's NY article features June Klein and Technology & Markeitng Ventures, INc.
- 1. VOL. XXVII, NO. 19 WWW.CRAINSNEWYORK.COM MAY 9-15, 2011 PRICE: $3.00 Small businesses, especially startups, often wont be profitable for years. But they still have to invest in such things as manufacturing tools and computers. Though the federal government offers a substantial tax deduction for equipment purchases, businesses that operate at a lossand thus dont owe any taxeslose the deduction for that year. JuneR.Kleinandherhusband,Ira Klein, would like that to change. They are pushing for federal legislators to propose a law that would create a marketplace where a small business could sell deductions it cant use. Connecting buyers, sellers A small-business owner herself, Ms. Klein is CEO of Technology & Marketing Ventures Inc., a Manhattan-based consulting firm. Mr. Klein is a tax attorney and general counsel for his wifes firm. TheKleinsenvisionamarketplace that would connect buyers and sellers and would determine the value of equipment-depreciation deductions through a bidding process. The mechanism would be similar to that for tax benefit transfer leases, which were developed during the recession of the early 1980s. The leases let owners sell equipment- depreciation deductions, though not in an auction-like setting. Most small businesses didnt take advantage of TBT leases because of their complexity and the legal costs, said Mr. Klein, who helped craft the details of those leases. The authorizing law was repealed in 1983, he added, as large companies were the primary beneficiaries of the leases. The Kleins insist that a tax benefit exchange would be simpler and would boost small companies by giving them cash for a deduction they cant use immediately. Income balancing Sara Horowitz, founder and executive director of the Freelancers Union, based in Brooklyn, thinks the exchange could help freelancers. Anything that allows them to even out their income over time is a good thing, she said. TheKleinsareworkingonbuilding local support for the initiative. In March, Ms. Klein gave the proposal to Nancy Ploeger, president of the Manhattan Chamber of Commerce, and to Sen. Kirsten Gillibrands staff in New York. They have also sent it to Rep. John Larson, a Connecticut Democrat on the House Ways and Means Committee. The senators office is reviewing it; Mr. Larsons has not yet done so. The Kleins argue that their proposed law wouldnt cost the U.S. Treasury anything and wouldnt affect the deficit, because depreciation deductions are already scored in the deficit calculations by the Congressional Budget Office. But that representation isnt accurate, according to Sandy Botkin, president of the Tax Reduction Institute and author of Lower Your TaxesBig Time!. If a firm in the top bracket buys the depreciation, it will get an immediate reduction in taxes and the government loses revenue, [perhaps] a substantial amount, said Mr. Botkin, also a former IRS attorney. I think that will make this a loser in Congress. They are looking for ways to balance the budget, and this isnt going to help them do that. Ms. Ploeger thinks the proposal has legs, however. President Obama has put a lot of money into funding Small Business Administration programs, and if this is another way to [do that], we should, she said. If you add up all the monies our government is already spending on small-business support$30 billion here, $50 billion therethe loss will be a drop in the bucket. BY: EILENE ZIMMERMAN Proposal would create a cash market for unusable depreciation breaks Promoters of a bill insist the cost is already accounted for SOLD: June and Ira Klein are gathering support for the auction-like mechanism they envision. 444 E 82ND ST NY, NY 10028 USA the-5th-estate.com jklein@tmv.com T:212.628.2178 F:212.744.2089