The other day I had coffee with a former student, now in her late 20s, whose first taste of startups and entrepreneurship was in a class I used to teach at the University of Oregon. The class included—of course—a hard look at cash flow and business numbers. But she told me she had no idea how important the numbers were until she actually started her own business.

“Back then, in class, it seemed like theory to me,” she said. “Like the business numbers were something that the bankers and accountants worried about, while the rest of us were out selling.”

“You can bet that changed,” she added. (And for the record, quotes are paraphrased from memory.)

Rose (not her real name) explained how getting her own business seemed to be swallowing her life. She was always worried, always wondering, playing over in her mind the next month what would she have to pay, where would the money come from. There were always questions about if and when she should add people as employees, offer more services and so forth.

Instead of drifting slowly off to sleep, she’d play over the worries in her mind. And instead of dealing peacefully with the rest of her life, she’d fill her spare moments with work—and work worries.

And for her, at least, she was much better with all this after really learning to know her numbers. In her case (I’m proud to say), she had some residual idea of business numbers still lingering from the classroom experience. So she knew where to start looking. She dug up some old explanations of cash flow, and dug into her online bookkeeping, and began to pull apart her last year or so of sales, costs of sales, running costs, fixed costs and cash flow.

She spent some time digging into the details of her business-to-business sales that required delivering an invoice and waiting to get paid. She took the extra effort to figure out the gross margin (sales less direct costs) for each of her three lines of service sales. And she looked at the difference between the clients who paid on time, or in some cases early (prepayments), compared to clients who paid late. And she looked at some supplies she was buying at a lower rate in bulk, but the real costs of storing the bulk.

“It’s been a real positive change,” she announced, proudly. “Now I have a pretty good idea, day by day, of where I stand with cash, receivables and payables.”

Not that she no longer worries. “At least I know now when I have something to worry about -- and here’s the good news -- when I don’t. So it’s way easier now to turn the worry off when things are okay. And when they aren’t okay, I know that early now, so I know when and why to worry and what’s the problem when I have one.”

And that’s a lesson I’d like to share in this space. I learned that myself, just like Rose did. My first degree was literature, my second Journalism, and although I did get the MBA later, I’m by nature a words and concepts person. But if you’re going to run a business, and you also want a life, then you should know your core business numbers: sales, costs, expenses, burn rate, balance sheet and, by far the most important, cash flow. 

Does your business source or manufacture all its goods in the USA? The “Made in the USA” tagline can be a powerful marketing tool, but it can also make good business sense.

According to the Washington Post, manufacturing in the USA can be a smart investment, even in the face of cheaper offshore alternatives. The article, written by Los Angeles-based small business owner Nicholas Ventura, cites “Five ways ‘Made in the USA’ can cut your company’s manufacturing costs.” Ventura is co-founder of Youth Monument Clothing, Inc.

“Made in the USA” is what built my business to what it is today. When starting your new business, ask yourself how you can harness the benefits of domestic production, too. You may be pleasantly surprised…” Why? Ventura cites the following advantages of US-based manufacturing:

• Inventory can be cut tremendously – Importing inventory often requires larger production runs to meet minimum orders that can tie up capital and cash flow in stock. But it’s a fine balance, as Ventura explains: “…missed sales due to lack of inventory is worse than having too much inventory in the first place. By being made in the USA, we can fulfill these orders and maintain a skinny inventory because turnaround times are quick.”
• Domestic supply chains are quicker – Turnaround time from overseas factories can be substantially slower than domestic suppliers. Sourcing domestic goods can help you meet demand more quickly.
• Forecasting becomes much easier – “The larger minimums and longer turnaround time forced us to buy production runs in large numbers and forecast trends with little confidence in our predictions,” explains Ventura. Domestic production increases agility and allows you to “react on the fly to the market” without “sitting on a ton of dead inventory.”
• You may save money – “Looking back, we would have made a better investment in developing our supply chains here in America rather than trying to cut costs from the onset,” says Ventura.
• “Think of your national pride!” – “Made in the USA” is a hot trend for a reason. “Production equals jobs – it’s a simple equation that many Americans ignore.”

Be Careful About “Made in the USA” Claims

If you are a U.S. manufacturer or are looking to promote your goods as “Made in the USA,” be sure you have a clear understanding of what this means. The Federal Trade Commission (FTC) is charged with preventing deception and unfairness in the marketplace and has the power to take law enforcement actions against false or misleading claims that a product is of U.S. origin.

If half your product is made in the U.S while the other half is manufactured in China, you cannot claim it is "American-made." To comply with “Made in the USA” standard, the FTC requires that all products advertised as American-made must be "all or virtually all" made in the U.S. Even if you don’t expressly state that your products are made in the USA (for example, in advertising or product labeling), giving the impression that your product is of U.S. origin (such as use of a flag or geographic reference) can get you into trouble if it is not accurate. Both of these types of expressed or implied statements are subject to FTC enforcement.

To learn more about potential red flags and how to ensure your “Made in the USA” product labeling, advertising or other claims are compliant with the law, check out this SBA blog: Made in the USA Labels: Information for Manufacturers, Retailers, and Consumers and be sure to refer to the FTC’s guide for business owners: “Made in USA.”

Related Articles

• How Lawful are our Small Business' Advertising Claims? - Tips for Getting it Right

Now that 2012 is wrapping up, we have the opportunity to take a breath, evaluate where the year has taken us in relation to our business goals and create a game plan for how we will move forward towards success in the new year. A business mentor may just be the perfect means to helping you create that plan. A study by the U.S. Small Business Administration, SBA ED Resources 10-11 Impact Study Final Report, found that small business clients who had received 3 or more hours of mentoring reported higher revenues and increased business growths. Whether you are already in business or looking to start one during the next calendar year, a mentor can help guide your business by providing an outside, unbiased perspective that will keep you on track towards your goals or, perhaps, offer new ideas you had not yet considered.

Planning for Your New Business Idea

If you have a great business concept—or even just a general idea of the kind of work you would like to be doing for yourself—a mentor can assist in hammering out the details of how to bring your ideas to fruition. If you have not yet created a business plan, a mentor can walk you through the process of doing so, bringing to the table years of real world business experience and having helped numerous other entrepreneurs get their ideas off the ground as well.

If you are not sure exactly what shape your business will take, the process of creating financial projections like pro forma income statements and profit and loss statements will give you insight into the results of several different scenarios before taking the financial and personal plunge. These financial statements can seem daunting to the uninitiated, but with a mentor with financial expertise at your side, you will be able to navigate them with ease. Having a clear picture of the financial potential of your business concept will let you know if it truly is feasible or needs to be further refined in 2013.

Planning for Your Current Enterprise

For current business operators, a mentor can help evaluate the current state of your business and make sure it is on track towards your goals. If you have not yet created a business plan for your enterprise, a mentor can guide you through doing so. If you have drafted a complete business plan, they can help you evaluate how you have met your objectives and revise the plan according to changes in the business, the business landscape or your goals.

No matter what the business topic, a mentor has likely encountered the same scenario or is able to refer you to someone else who has. Mentors are unique in that they have specific expertise from their own experiences in the business world, but also a wealth of general business knowledge from helping others start and grow their ventures. Some topics and questions a mentor can help you think through in planning for 2013 are:

Marketing: How effective is my current marketing plan? Are these efforts on track with my goals

New Offerings & Directions: Where does my business stand in relationship to my competitors? What opportunities exist for me to expand or take the business in new and profitable directions?

Technology: Are my employees equipped with the right technology for the activities and goals I want to accomplish?

Budget & Cash Flow: Does my budget match with the initiatives I have set out for next year? Will I have sufficient cash flow to carry me throughout 2013?

A Sounding Board

One of the greatest benefits a mentor can offer your business is simply a wise ear. We hear time and again from SCORE clients that the greatest function their mentor serves is as a sounding board: someone to bounce ideas off of, rehearse their elevator pitches with and be reassured that they are on the right path. A mentor also makes a fantastic addition to your business team because they offer an outside, unbiased perspective that can spot obvious fixes or opportunities you may be too entrenched to see and supply fresh ideas to solve nagging problems. Cassie Green, owner of Green Grocer Chicago, spoke of her mentor saying, “It’s great to get a perspective from someone who doesn’t have a personal interest in the business. They are totally objective and just want you to succeed.”

Entrepreneurship can certainly seem like a lonely road at times. But working with a mentor to plan out a map that will help guide you along that road can make it a little easier.

Do you think it’s too late to attract holiday shoppers into your business? Whether you’re a retailer, a restaurant or a service provider such as a spa or hair salon, there are still plenty of holiday dollars to be had. The spending doesn’t stop after Christmas, either—consumers with gift cards or gift cash in their pockets are out in droves, eager to treat themselves, celebrate and splurge. How can you attract customers to your business for the holidays? Try these tactics.

1.      Focus on existing customers. Instead of putting all your effort into attracting more new customers, put most of your effort into getting existing customers to buy more. Current customers are already in the mood to buy from your business—all they need is a nudge. Reach out to your current customer list via email, direct mail or even phone calls with enticing offers to get them into your store, restaurant or establishment. When customers make a purchase, give them a coupon good for a dollar or percentage amount off the next purchase—but make it a limited-time offer, such as a week or 10 days.

2.      Put it on display. If your business depends on foot traffic, such as in a mall or a downtown shopping area, the importance of signage and window displays in attracting customers inside can’t be overestimated. Use sidewalk signs to announce specials, sales or deals inside. Make sure your store windows convey all the goodies you have to offer, while still offering a good view inside the establishment. Put holiday lights and décor up outside, if zoning regulations allow. Consider having a salesperson offer free samples, or have someone selling impulse buys at a small gift table outside your shop’s door (zoning permitting of course).

3.      Create a festive atmosphere. Sights, smells and sounds attract shoppers at the holidays, and these tactile dimensions are what separate in-store shopping from clicking through a website. Make sure your store feels inviting, with holiday music playing, evocative but not overpowering scents, and décor that conveys your business’s brand (whether that’s Currier and Ives cozy and traditional, or Crate and Barrel sleek and modern). You could even have your employees (if appropriate to your image) dress in red and green, or wear Santa hats or sleigh bells, so they stand out from the crowd.  

4.      Know your stuff. “Showrooming,” or the trend of consumers using smartphones to search for better prices on items they’re perusing in stores, sounds scary, but there are ways to deter it. Knowledge is power, so make sure your salespeople have as much knowledge about your products as possible. Alert your sales associates to watch for showrooming behavior and, when they see customers looking at their phones, cheerfully approach and offer to answer any questions they may have about the product. Point out the benefits of buying from you, such as being able to get the item now instead of waiting for it to arrive by mail, store warranties or any other benefits you can think of.

5.      Use the right marketing messages. It’s not hard to get people to ease up on the purse strings this time of year—if you take the right approach. What marketing messages resonate at the holidays? Attract consumers who’ve been spending, spending, spending on friends and family with marketing messages that encourage them to treat themselves. Appeal to frazzled moms by urging them to take time out to relax and renew their spirits. Get just about everyone to open their wallets with marketing messages about making memories and enjoying family togetherness.

Try these marketing tactics, and watch your business profit from the holiday spirit.

Having a business plan is a must for small business owners, but finding the time to put pen to paper often means putting them on hold until the very last minute, such as right before that big meeting with a loan officer or bank manager.

But business planning does not have to be that way.

Every smart entrepreneur and business owner should already have a firm grasp of key information about their business and on what will influence the path they take and decisions they make over the course of 1-3 years.

Putting this information together into a concrete plan is essential if you want to secure a business loan or outside financing, of course.  But the planning and mental exercise of writing it down is just as important to the success of your business. Writing a plan will not only help you succeed, but it will open your eyes to what it’s going to take to get there.

One of the big challenges for smaller businesses is actually building a business plan. What format should it take? What numbers should you pull together to demonstrate that you have a rock solid financial foundation?

SBA has just launched a new online tool that can help.

“Build a Business Plan” Online Tool

To simplify the process, SBA has just launched a new “Build a Business Plan” online tool that guides small business owners through the process of creating a basic, downloadable business plan. The great thing about this tool is you can build a plan in smaller bites, save your progress and return at your leisure.

The tool offers a tab-based step-by-step guide that lets you enter information into a template for each section of the business plan, including market analysis, company description and financial projections. The tool is secure and confidential and will keep your plan on record for up to six months. You can also save, download or email the plan at any time.

Discuss Your Plan with a Small Business Advisor

Don’t forget: you can also use your completed business plan to discuss your next steps with a mentor or counselor from an SBA resource partner such as SCORE, a Small Business Development Center or a Women's Business Center.

Then be sure to keep your plan fresh, revisit it, and measure progress against it. As your business grows, your plan – and your benchmarks for success – will grow with it. 

Related Articles

• 4 New SBA Online Tools That Can Take your Small Business to New Levels
• SBA Unveils New Learning Center

The definition of fundable is the capability of being funded or being bankable. A company’s fundability is crucial to obtaining the necessary funds needed to operate, develop and grow a business.

Unfortunately, the most common mistake business owners make is applying for financing before their company is even ready.

Why not know in advance if you qualify for funding before actually applying?

Instead of relying on personal credit, why not establish a fundable company that can get the financing it needs based on its own creditworthiness.

There are several different areas that contribute to how fundable a business will be for short-term or long-term financing.  The three main areas that impact a company’s fundability include:

1. Compliance – Lenders have specific guidelines that credit applicants must adhere to as part of the underwriting process. Meeting these standards is mandatory if you expect to qualify for credit. This includes, but is not limited to: corporate structure, business listing, commercial address, state filings, licenses, etc.

2. Business Credit Reports – Getting listed with the major business credit agencies such as Dun and Bradstreet, Experian and Small Business Equifax allows lenders to review your company’s credit profiles. Creditors rely on these particular agencies to assess the credit worthiness of a company. If you apply for credit with a lender or supplier and your company is not listed, then you may get denied credit or be required to allow a personal credit check and/or personal guarantee.

3. Business Bank Account – Another factor is a company’s bank account history. Bank credit consists of three main components a business owner should familiarize him or herself with prior to applying for funding. This includes, but is not limited to: account age, account history, balance rating, etc. In some instances, a lender may contact a business owner for bank references, so maintaining a positive banking relationship is vital to a company’s fundability.

4. Company Assets – Turning paper into cash is not a new strategy, but it is definitely an option worth considering if you have access to the types of paper that can be converted. This includes, but is not limited to: letters of credit, financial contracts, accounts receivable, inventory, real estate, promissory notes, etc.

All of these factors play an integral part in determining how fundable a business is. Lenders also take into consideration the age of a business and the type of industry involved.

These are just a few of the items that are regularly used by lenders, credit providers and even insurers to approve or decline an application. Now is the time to find out where your business stands.

Does your product do what your advertising claims it does? Perhaps you’ve invented or imported a product “that will remove even the toughest carpet stain in 10 minutes – guaranteed!” Can you stand behind that claim in a court of law?

Even if you don’t realize that your claims are false, the Federal Trade Commission (FTC) or your state government can take action against you for non-compliance with marketing and advertising laws.

Take for example an actual case scenario (described in this FTC blog post) in which the FTC challenged claims for “Rest Easy,” a natural product available nationwide that claimed to “Kill & Repel Bed Bugs… Rest Easy is HIGHLY effective, killing 90% of bedbugs within 2 seconds of contact, and the rest within 30 minutes…”

According to the FTC, the company behind the product and its corporate officers had no sound science to back up their promises. Under the settlement — which included a $264,976 judgment— the business needed “competent and reliable scientific evidence to support performance or efficacy claims they make about Rest Easy or any pesticide they market in the future.”

So what do advertising laws require you to do when you market your product, promotions or services? Here’s what you need to know:

Federal Truth-in-Advertising Laws

To ensure your business is in compliance with the Federal Trade Commission Act, follow the following rules:

• Your advertising must be truthful and non-deceptive – This means it must not contain information that is misleading or omit information that can influence a buyer’s decision.

Example: You must have proof to back up both express (explicit) and implied claims that consumers take from an ad. For example, "ABC Mouthwash prevents colds" is an express claim that the product prevents colds. An implied claim is one made indirectly or by inference. "ABC Mouthwash kills the germs that cause colds" contains an implied claim that the product will prevent colds. Although the ad doesn't literally say the product prevents colds, it would be reasonable for a consumer to conclude from the statement "kills the germs that cause colds" that the product prevents colds.

The same applies when you make claims about free offers such as “buy one get one free” or “buy ABC and get XYZ free.” Be clear about limitations and disclose your terms and conditions.

• The evidence must back up your advertising claims – This means you’ll need objective evidence to support your claims. The kind of evidence depends on the claim – at a minimum you must have the level of evidence you say you have.

Example:  The statement "Two out of three doctors recommend ABC Pain Reliever" must be supported by a reliable survey to that effect. If the ad isn't specific, the FTC looks at several factors to determine what level of proof is necessary, including what experts in the field think is needed to support the claim. In most cases, these ads need to be supported by tests, studies or other scientific evidence that has been evaluated by people qualified to review it using acceptable, accurate methods.

• Advertisements cannot be unfair – For example, don’t knock what your competitors have to offer by using false or misleading information.

State and Local Truth-in-Advertising Laws

Next, confirm that you are not violating state and local truth-in-advertising laws. For example, some states expect you to have enough stock in inventory to meet demand for advertised products. If you don’t, then your ad needs to state that quantities are limited. USA.gov provides links to state and local consumer agencies responsible for enforcing truth-in-advertising and related consumer protection laws.

In a Nutshell

The next time you brainstorm your advertising claims, have the following checklist in mind:

• Be accurate – Deceiving or misleading your consumers is illegal. And it’s not just your words; your product imagery should be accurate, too.
• Get permission for endorsements, quotes or whenever you choose to mention a person or organization’s name.
• Be fair to your competitors and accurate in your claims about what your product does and what theirs does not.
• Watch your pricing claims – Many retailers make cost comparisons to entice consumers. Whatever you do, don’t make untruthful claims or comparisons on this one.
• Claims likely to raise a red flag at the FTC – The FTC pays closest attention to advertising claims about health or safety, such as: “ABC will reduce the risk of skin cancer” and ads that make claims consumers would have trouble evaluating themselves, such as: “ABC refrigerators will reduce your energy costs by 25 percent.”

More Information

• Truth-in-advertising doesn’t just affect your ad claims. Read more about marketing to children, green marketing, product labeling, “Made in the USA” claims and more in SBA’s Small Business Guide to Marketing and Advertising Law.
• Advertising FAQ's: A Guide for Small Business (FTC)
• “Great Service, Will Use Again”: How to Use Customer Testimonials to Market Your Business

If you’re like most business owners, you are always looking for places to promote your business online. After all, you don’t have the advantage of huge brands that are household names. You have to work at getting visibility. Here is a handy checklist of 12 places to get visibility – make sure you have these covered if they apply to your business:

OFFLINE PLACES

Customer Receipts: Put your website URL on your receipts to build awareness and loyalty. Provide the URL to a survey (make sure the URL is short) on your website. Offer a free monthly drawing for those who take part in the survey to encourage them to visit your website. Not only will it encourage visitors, but you could gather some terrific customer feedback and testimonials this way.

Packaging: Do include your website address on packaging material. If you provide a sturdy and nice-looking shopping bag, for instance, many people will save it. They will see your URL again and again each time they re-use the bag – or it may be passed along to someone else to see.

Outdoor advertising and advertising in public places: If you depend on a local market, consider outdoor advertising such as billboards, buses, subway station placards, train stations and other public venues. For this, it helps to have a short or catchy domain name that people can easily remember.

In Presentations: If you’ve been invited to speak at an event — whether it’s for the local Chamber of Commerce breakfast or a national industry event — include your web address prominently on any PowerPoint slides. At the very least, put your URL on the beginning and ending slides, and if possible in the footer of each slide. Don’t forget key social media profiles — and mention your blog, too! Give people a reason to want to stay connected with you afterward. If people request a print copy of the presentation, the information will be there. Or, if the presentation is shared online as is often the case, the URL will be there.

Direct Mailers: The USPS has an affordable direct mail program called Every Door Direct with an online tool you can use. If you issue mailers through this or any other method, include a URL for a landing page specifically tied to that mailer (such as mybiz.com/mailer). That way, when people visit you will know it was as a result of the mailer, and you can track response rates better.

Business Cards: You might laugh at this and say, “Doesn’t everybody have their Web address on their business cards?” Yes, there are still some people who do not. Don’t be one of them. But let’s assume you already have your Web address on there — here’s another tip: include a QR Code that recipients can scan with a mobile device, taking them to an information page on your website optimized for mobile. Or offer them a special incentive to scan the code, such as special tips or to receive a freebie Guide. When you make it quick and easy for people to visit your site by whatever method they prefer, you win.

ONLINE PLACES

Email Signature: Include a link to your website in your email signature so that every time you send a message to a customer, vendor or even a friend, you’re promoting your site. Besides, it’s a courtesy. Nothing is more irritating than to need to contact someone and not be able to find a phone number or a Web address in email messages. Include one or two key social profiles, too, such as Twitter and your company Facebook Page.

Press Releases: Today you can issue press releases easily online through one of the many press release distribution services that will syndicate it out to numerous sites. You don’t necessarily need to have a PR firm working for you. Not sure you have news to reveal? Most companies have some kind of news – they just may not consciously think of it. New products, a key new executive hire, a partnership arrangement, achieving a major milestone, receiving an industry award — all are reasons to issue a press release. If you’re not in the habit of issuing releases regularly, put it on your calendar as a reminder for once a quarter.

Local Listings: If you are a local business, be sure you have claimed and verified the accuracy of your local listings in Google, Bing, Yelp and other places. An easy way to do this is to use an online tool such as GetListed.org that will check the major listings and assist you in updating them. Be sure to include your website URL in each local listing. And make sure it’s correct!

Professional Communities and Directories: Don’t forget about professional communities and places where businesses are listed. Whether you’re a small business taking advantage of a networking site like BizSugar, part of the local Chamber of Commerce, the Better Business Bureau or an industry group, take advantage of any directories and list your site!

Social Media Pages: Set up pages on major social media sites for your company and include the website address, of course. This includes your company Twitter account, company Facebook Page, Google+ page, LinkedIn page — even Pinterest and other sites. Go over to Knowem.com and you can find hundreds of social sites where you can reserve your name. You don’t have to set up and use hundreds, but at least cover the major sites frequented by your customers and target audience.

Guest Blog Posts: Contributing guest posts on other blogs is an accepted way today to develop thought leadership for company executives and to make others aware of your company. Look for authoritative sites in your industry when searching for guest posting opportunities. Then, be sure to include a brief “About the Author” statement that includes your website URL. Not only will you get in front of the readers of that other blog, but you may be contacted by the media (who look at blogs for article ideas). It will tell them where to find information online about you and your company.

Remember, your website is your home base on the Web­­­—the place that anyone should be able to go to and find out more information about your company. All roads should lead to Rome (i.e., your website). Where do you promote your site and make others aware of it?

During the season of giving thanks and giving gifts, charitable giving can make a big difference to those in need and also shine a favorable light on your small business. But what’s the best approach and how do you claim that all-important tax deduction? Here are some tips for developing a charitable giving strategy and claiming the right deduction.

Giving Back is Good for Small Business

Research shows that giving back is not only important to small business, but  also important to your customers. According to a 2010 philanthropic study by Cone Communications, 85 percent of consumers have a more positive image of a product or company when it supports a cause they care about. Ninety percent want companies to tell them how they’re supporting causes. So more than 278 million people in the U.S. want to know what a company is doing to benefit a cause.

Charitable giving is also great for employee morale because it brings employees together to support good causes that are separate from their everyday work-life. From a marketing perspective, it can also give your business an opportunity to reach out and connect with members of your community on a different platform.

Of course, there’s also the tax deduction – more on that at the end of this post.

Making it Happen

Despite the benefits, charity isn’t always easy for small businesses. Finding the time and resources for meaningful activities can be challenging. And how do you determine which charity is the right fit for your business and your community?

As with all aspects of managing your business, it’s important to have a plan that is clearly tied to your goals. Connect your business purpose to a particular charity. For example, if you are in the restaurant trade, support a charity that collects food for the homeless or organizes military care packages for our troops. Lawyers could support charities or non-profits that work to provide low-cost legal support for low-income individuals.

If you can’t find an appropriate charity, simply pick one you’re passionate about and that will resonate with your employees.

For some other ideas about getting your small business involved in giving back, read this blog from SBA guest blogger Anita Campbell on SmallBizTrends.com: 5 Steps to Giving Back: Charitable Giving and Your Business. Anita’s tips can help you:

• Determine what causes you want to help
• Involve employees
• Investigate the organization
• Decide how you will help
• Get your customers involved

Claiming Your Tax Deduction

Most charities or non-profits operate as tax-exempt 501(c)(3) organizations and donations made to them are tax deductible. Donations that are eligible for a tax deduction include cash, volunteered services, sponsorship of local charity events or the donation of inventory or services.

Be sure to check the tax status of the charity of your choice either directly with them or with this online search tool from the IRS for a quick look-up of tax-exempt organizations.

So what tax benefits can charitable giving provide?

Charitable contributions can qualify as tax deductions against your business’ annual tax liability. Generally, you can deduct up to 50 percent of your adjusted gross income. However, the IRS tax code is complex and it’s important to note that not all contributions can be deducted.

• Cash contributions – You can claim a deduction for cash or other monetary contributions as long as they aren’t set aside for use by a specific person. Make sure you make the contribution within the current tax year to be eligible for the deduction, regardless of the accounting method your business uses. Use Form 1040, Schedule A, to itemize deductions on your return.
• Property or inventory donations – These are tax deductible, although you’ll need to assess their fair market value. Use Form 8283 for donations over $500.
• Volunteering – This is a popular form of giving, and while you can’t deduct the value of your service, you can deduct some of the expenses you incur such as the cost of buying a uniform or even the costs of hosting a fundraising party.
• Benefits you receive as a result of your giving – If you get something in return for your donation you can only deduct the amount of your contribution that is over the value of the benefit/prize you receive. Suppose your company got involved in a charity auction and you placed a winning bid.  If you bid $500 and the fair market value of the prize was $200, you can deduct the difference of $300.

It’s always a good idea to consult your accountant or tax advisor for information about what constitutes a charitable tax deduction and how to properly file your claim.  Check out this IRS Guide to Charitable Contributions, too.

As head of The Investment Division of the U.S. Small Business Administration, I am proud to present the results of the Small Business Investment Company Program for Fiscal Year 2012 in our Annual Report . We have achieved record success for a third year in a row, providing the capital small businesses need to fuel their growth and create jobs.  This Annual Report reflects our commitment to the continued growth of the SBIC Program.

With the economy still in recovery, SBA’s mission of supporting small businesses and the Americans they employ has never been more critical. Small businesses are responsible for creating over 60% of the country’s net new private sector jobs each year. Yet despite their importance to the health of the overall economy, many small businesses struggle to access the capital they need to expand operations, build new facilities and hire new staff.

In FY 2012, the SBIC Program channeled more than $3 billion to over 1,000 small businesses. And we estimate these financings created or sustained over 65,000 jobs. We achieved these results at zero cost to the taxpayers, thanks to the public-private partnership at the program’s core.  Even in an era of tightening budgets, SBA is able to efficiently harness the talent of professional investment managers to expand the pool of capital available at the smaller-end of the market.

Critical to the success of the program is attracting private capital to the funds.  The Annual Report analyzes in detail the financial returns to private investors participating in the program and found that these returns compare very favorably to the private equity industry as a whole, and demonstrate that private investors can significantly improve their return by accessing SBA leverage.

As we look to the future, we are investing heavily in improved data management systems, both to enhance our own underwriting processes, but also to provide current and future program participants additional data for more informed investment decisions.

In line with the SBA’s agency-wide commitment to transparency in government, the report was prepared with U.S. taxpayers in mind. We hope all of our stakeholders find this SBIC Program Annual Report useful in evaluating the program’s past, but also in helping to shape its future.