Tax Withholding Guidance Released

Taxes 2.jpegThe IRS recently released a notice providing the 2018 income tax withholding tables, showing the new rates for employees. The tables reflect changes made by the tax bill that was signed into law last month, including the increase in the standard deduction, repeal of personal exemptions, and changes in tax rates and brackets. They are designed to work with the Forms W-4 that employees have already filed with their employers.
The IRS is directing employers to implement the new withholding tables as soon as possible, but no later than February 15, 2018. This guidance is the first of several items that the agency plans to release this year in order to simplify the transition of the new rules.
For the IRS’s FAQ on the Tax Withholding Timetables, click here.

Government Shutdown Comes to an End

capitol building.pngAfter a three-day shut down, Senate leaders reached an agreement to fund the government through February 8. The Senate voted 81-18 to pass the measure, shortly followed by the House, which passed it 266-150. The deal was based on a commitment by Senate Majority Leader Mitch McConnell (R-KY) to find a solution for Dreamers to remain in the U.S. until February 8. The agreement includes:

  • Authorizes the Small Business Administration to shift funding to administer increased 7(a) loan demand
  • Delays the re-implementation of the Obamacare medical device tax through 2019
  • Delays the re-implementation of the tax on “Cadillac” health plans through 2022
  • Suspends the Obamacare tax on insurance providers for 2019
  • A provision to provide back pay to workers who were briefly furloughed
  • A six-year extension of the Children’s Health Insurance Program (CHIP)

The continuing resolution (CR) includes other provisions which can be found here.

This is the fourth CR for FY18. As a reminder, a CR funds the government at current levels, in this case, FY17 levels. Having trouble keeping track of the CRs for FY18? See below.

CRs for FY18

  • September 30, 2017: First Deadline for FY18 – CR extended funding through December 8, 2017 (passed by Congress on September 8)
  • December 8, 2017: Second Deadline for FY18 – CR extended funding through December 22, 2017 (passed by Congress on December 7)
  • December 22, 2017: Third Deadline for FY18 – CR extended funding through January 19, 2018 (passed by Congress on December 21)
  • January 19, 2018: Fourth Deadline for FY18 – CR extended through February 8, 2018 (passed by Congress on January 22)
    • Note: The House passed a CR on January 18 to fund the government through February 16. After House passage, the Senate amended the CR by changing the expiration date from February 16 to February 8 and including the back-pay provision. The Senate then passed the amended bill yesterday afternoon, with the House following suit on January 22.  President Trump signed the bill into law that night.
Members Answer WIPP’s Call to Action!
On January 19, as the Senate was trying to find a way to keep the government open, we issued and Action Alert asking WIPP members to contact their senators about the shutdown. We’re proud to report that the Action Alert resulted in nearly 50 letters sent to Senators urging them to keep the government operating and telling them that shutdowns are bad for women business owners.
Thank you for making your voice heard and watch for future opportunities to engage!

2018 will be a big year for WIPP. Please join us!

January Letter From WIPP President Jane Campbell

Happy New Year!

Washington was hit by a deep freeze at the beginning of January, causing a bit of a slow start for Congress. But national politics has already resumed its’ torrid pace.

Jane Campbell photo

WIPP President Jane Campbell

Don’t worry, Women Impacting Public Policy, with cool heads and thoughtful deliberation, will continue to advance and advocate for meaningful public policy that has a positive impact on women business owners. 

We are off to a great start. This week, we held an informative and well-attended policy briefing to help our members understand the intricacies and impacts of new developments, like the tax law, in Washington. This will be a new monthly series where members can ask WIPP’s Chief Advocate Ann Sullivan and me questions about the rapidly shifting policy landscape.

On top of our policy work, we are planning a new series of ChallengeHER events across the country to deliver the information and connections women need to succeed in government contracting. We are also busy lining up an informative slate of GiveMe5 webinars to provide members with government contracting knowledge delivered by experts in the field. From taking the first steps into contracting to learning what to do once you’ve landed a big government contract, these webinars are an indispensable resource!

As you can see, WIPP is on track to accomplish many amazing things this year. But it’s your voice and membership that makes us powerful in Washington. And it’s more important than ever that women entrepreneurs make their voices heard. After all, if we are not at the table, we will only get the scraps.

WIPP is a nonpartisan organization that brings women from all walks of life and both sides of the aisle together to speak with one voice about what women in business need to succeed. Please consider joining us today.

Jane Campbell
WIPP President

2017: A Banner Year for WIPP & Women Business Owners

WIPP was busy this year educating policymakers, women business owners, the media and the public about what women business owners need to succeed. From bringing women entrepreneurs directly to some of the most powerful lawmakers in the country, to meeting women entrepreneurs where they live and do business to educate them on how to bolster their businesses, WIPP was at the forefront of issues impacting women in business in 2017.

A sampling of our (many) accomplishments are highlighted below:

Educating Thousands of Women Business Owners Nationwide

  • WIPP held 12 ChallengeHER events in cities across the country, training more than 2,100 women on the best practices for success in federal contracting; including 5 match making events with federal agencies and primes.  WIPP has educated more than 10,000 attendees through its classes that range from those who are new to the process to those highly experienced. Learn more about ChallengeHER, and read about some of the success stories that have come out of the program.
  • WIPP produced 30 Give Me 5 training webinars increasing the free, on-line curriculum to approximately 120 downloadable recordings.  Reaching over 3,000 people this year, these training webinars were taught by industry specialist and federal contracting experts.
  • More than 200 women business owners joined WIPP and Chicago Treasurer Kurt Summers for a discussion on venture funding and women owned small business. The discussion explored how to encourage venture capital investment in women, the process of lending for SBICs, and how women business owners can approach venture capitalists.

Impacting Policy at the Highest Levels

  • The president signed the 2018 National Defense Authorization Act (NDAA) into law, which includes a provision directing the Small Business Administration to study small business participation on Multiple Award Contracts. The SBA study is in response to a WIPP report revealing that women small business owners are being shut out of large government contracts. Learn more about WIPP’s study.
  • WIPP surveyed 515 WIPP-affiliated women business owners nationwide on how they use the tax code and worked with American University’s Kogod Tax Policy Center to use the survey data to research how the tax code impacts women business owners. The survey data – together with Kogod’s review of existing tax research on the topic – suggests that many women-owned companies are unable to fully access more than $255 billion worth of tax incentives Congress has designed to help small businesses. The study was picked up exclusively by the Associated Press and was featured in hundreds of papers across the country. Learn more about the report in an op-ed WIPP President Jane Campbell authored in Entrepreneur magazine.
  • WIPP brought women business owners to Washington to testify at tax hearings and help inform the framework for the House Small Business agenda.
  • WIPP’s Economic Blueprint, which outlines a range of economic policy recommendations lawmakers can follow to help women entrepreneurs thrive, was featured in Forbes. Read WIPP President Jane Campbell’s op-ed outlining WIPP’s Economic Blueprint in The Hill.
  • WIPP secured powerful politicians to speak at WIPP’s annual conference so they could hear directly from women business owners on what they want out of Washington. Lawmakers included House Ways and Means Chairman Kevin Brady (R-TX), Sen. Joni Ernst (R-IA), House and Senate small business committee tax experts and Senate Small Business Committee leadership.
  • WIPP’s advocacy efforts throughout the tax reform debate—which included submitting comments to the Senate Finance Committee urging parity for pass through entities and repeal of the estate and AMT taxes—were instrumental in securing a pass-through carve out, along with the agreement to double the estate tax exemption from the current $5.6 million per individual to $11.2 million ($22 million for couples). WIPP members authored op-eds, letters to the editor and did interviews with reporters on the issue to ensure the women-owned business perspective was breaking through.
  • WIPP’s advocacy team worked to maintain funding for programs important to WIPP, such as the Women’s Business Centers, microloan lending programs and more.
  • WIPP submitted testimony to Congress and statements to the media urging stability of the small business health insurance marketplaces and that Congress keep in place a pooling mechanism for small businesses to buy health insurance.
  • WIPP encouraged the Consumer Financial Protection Bureau to support the implementation of Section 1071 of the Dodd-Frank Act requiring financial institutions to gather and report data on small business lending, including applications made by women and minority owners. Read our press statement and our comments to the CFPB.
  • WIPP supported the Promoting Women in Entrepreneurship Act.
  • WIPP was mentioned in more than 60 news articles in 2017, ensuring the women business owner perspective was heard throughout national debates around tax reform, the federal budget, entrepreneurship and more. We had articles in Forbes, Entrepreneur Magazine, Financial Times, The Hill newspaper, The Atlantic, the Business Journals, Reuters, the Associated Press, Morning Consult, Bloomberg, the Chicago Tribune, NBC and many more.

Supporting Small Businesses on Small Business Saturday

  • 2017 saw record support from business organizations through the Small Business Saturday Coalition, the national grassroots initiative that WIPP leads to promote Small Business Saturday, with more than 575 organizations nationwide supporting small businesses on Small Business Saturday—an 18% increase over previous years.
  • Organizations WIPP engaged to support Small Business Saturday included the National Retail Federation, Association of Women’s Business Centers, U.S. Black Chambers, Inc., and SCORE, as did local organizations such as the Chicago Public Library, San Francisco Chamber of Commerce, Main Street Iowa and many, many others.
  • WIPP’s leadership around the Small Business Saturday Coalition was instrumental in promoting 7,200 events and activities celebrating Small Business Saturday nationwide, engaging more than 2.2 million small businesses.
  • The Coalition secured 653 mayoral proclamations in support of Small Business Saturday nationwide and ensure numerous public service announcements were issued promoting the day.
  • WIPP secured passage of a Senate Resolution designating Small Business Saturday and introduction of House Resolution and engaged 240 Members of Congress in Small Business Saturday activities.

WIPP In the News: December 2017

WIPP officials, members and activities drew media attention on issues ranging from tax reform to Small Business Saturday. Check out the 10 media hits featuring WIPP over the last month.

The Hill: Tax Bill Isn’t Perfect But a step in the Right Direction

Forbes: Female Business Owner Feeling Set-Aside? Consider This Option

Epoch Times: Republicans Forge Ahead with Tax Reform

Fosters Daily Democrat: Small Business Saturday posts impressive numbers

Niagara Frontier: Reports: Estimated 43% of American adults shopped or dined small on Small Business Saturday

Survey: Small Business Saturday Inspires Consumers to Shop Local

The Journal News: Port Chester to make Nov. 25 Small Business Day

Market Business Insider: Nine-in-Ten U.S. Consumers Say Small Business Saturday Has Had a Positive Impact on Their Community

The Eagle: Tax reform would boost women-owned businesses

Vision Times Media: Helping women entrepreneurs get federal contracts

Tax Plan Steams Ahead

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House Ways and Means Chairman Kevin Brady of Texas discusses tax reform during WIPP’s 2017 annual meeting.

Last week, the Senate passed tax reform (H.R. 1), setting up a conference to produce a united bill with the House. Versions passed by the Senate and the House contain significant differences which must be resolved before final passage.

Proposed business tax changes are listed below, highlighting the differences in the House and Senate version.

  • Individual Tax Rates
    • House: Four Brackets—12%, 25%, 35% and 39.6%—allows an additional rate for higher income earners
    • Senate: Seven Bracket—10%, 12%, 22%, 24%, 32%, 35%, and 38.5%
  • Pass-Through Treatment
    • House: tax rate for qualified business income 25%. Only 30% of business income is eligible for this rate. Personal services companies are not eligible for this rate.
    • Senate: Deduction allows for 23% of qualifying business income, up to $250,000 for single filers or $500,000 for joint filers (expires after 2025)
  • Corporate Tax Rate
    • House: Permanent reduction to 20% (effective 2018)
    • Senate: Permanent reduction to 20% (effective 2019)
  • State and Local Taxes (SALT)
    • House: Preserves property tax deduction of as much as $10,000
    • Senate: Preserves property deduction up to $10,000 (expires after 2025)
  • Estate Tax
    • House: Doubles the exemption to $11 million for single tax payers and $22 million for married tax payers (repeals in 2025)
    • Senate: Doubles the exemption to $11 million for single tax payers and $22 million for married tax payers through 2025 (no repeal)
  • Alternative Minimum Tax (AMT)
    • House: Repeals the AMT for individual and corporate filers
    • Senate: Retains the AMT for individual and corporate filers and raises the individual threshold
  • Healthcare Mandate
    • House: Maintains the individual mandate requiring the purchase of health insurance
    • Senate: Repeals the individual mandate requiring the purchase of health insurance

A Senate and House conference has met to come up with a single bill to send to the president. Republican leaders in the Congress hope to vote on the conference version next week.

 

October Policy Watch: Taxes, Budget & More

WIPP Government Affairs

GOP Releases Tax Reform Proposal: What’s in it for you?

Congress has finally taken the long-awaited steps toward implementing tax reform. GOP leaders released their framework for tax reform in a proposal entitled, “Unified Framework for Fixing Our Broken Tax Code.” Provisions pertinent for small business in the plan include:

  • Limits the maximum rate applied to pass-through entities to 25% (currently 39.6%)
  • Reduces the corporate rate to 20% (currently 35%)
  • Consolidates the seven individual tax brackets to three: 12%, 25%, and 35%
  • Allows room for Congress to add a fourth bracket for high income earners
  • Repeals the Estate Tax
  • Repeals the Alternative Minimum Tax (AMT)
  • Eliminates taxes on the first $24,000 of income earned by a married couple and the first $12,000 of income earned by a single individual (currently $12,700 for married filers and $6,350 for single filers)
  • Eliminates the standard deduction and personal exemption for filers
  • Allows businesses to expense the cost of new investments in depreciable assets for five years
  • Partially limits the deduction for net interest expense incurred by C corporations
  • Eliminates some itemized deductions (but does not specify which provisions)
  • Eliminates § 199 manufacturing deduction
  • Retains tax benefits for retirement security (401K, IRA)
  • Implements territorial tax system

House Ways and Means Committee Chair Kevin Brady (R-TX) attended the WIPP Annual Leadership Meeting Luncheon to talk about the plan and to answer questions from members.

Finalizing the Budget: Why Does It Matter?

If both the House and the Senate do not pass an FY2018 Budget, the GOP tax reform framework cannot pass in its current form. Congress hopes to pass tax reform though reconciliation, a process that allows the Senate to pass budget-related legislation with a simple 51 majority vote, instead of the 60 votes typically required. The GOP has a 52-48 majority in the Senate. If the budget resolutions do not pass, the tax reform package negotiated by the Administration and GOP Congressional leaders would require at least eight Democratic votes.

Last week, the House passed their FY2018 Budget Resolution, H. Con. Res. 71, which contains reconciliation language that directs the House Ways and Means Committee to begin drafting tax reform legislation. The House resolution provides $300 billion over 10 years to pay for tax reform. The Senate Budget Committee also passed their FY2018 Budget Resolution.  The Senate resolution contains reconciliation language that provides the Senate Finance Committee with $1.5 trillion over 10 years for tax reform.

The bill will be taken up by the Senate when they return from recess next week.

SBA Issues Notice of WOSB NAICS Changes

SBA is responsible for implementing and administering the Woman-Owned Small Business (WOSB) Program. The WOSB Program authorizes federal contracting officers to restrict competition for an acquisition to WOSBs, provided that appropriate conditions are met. In order to identify the industries eligible for set-asides under the WOSB Program, the SBA administrator has to conduct a study every five years to identify which industries WOSBs are underrepresented in in the Federal marketplace. As a result of the 2014 study findings, SBA increased the number of NAICS codes authorized for use under the WOSB Program to 113 four-digit NAICS industry groups, effective March 3, 2016. Consequently, WOSBs have been able to compete for and receive contract awards in 92 four-digit NAICS industry groups or 365 six-digit NAICS codes. EDWOSBs have been able to compete for and receive contract awards in 21 designated four-digit NAICS industry groups or 80 six-digit NAICS codes, in addition to those authorized for WOSBs.

On August 8, 2016, OMB published its most recent update to the NAICS industry groups, NAICS 2017, “Notice of NAICS 2017 final decisions.” These went into effect on January 1, 2017. In order to align the WOSB Program with the Notice of NAICS 2017 final decisions and SBA’s adoption of NAICS 2017 for its size standards, SBA is issuing this notice to amend the NAICS codes eligible for use under the WOSB Program.

Changes to WOSB NAICS

  1. 2012 NAICS codes 333911 and 333913 à 2017 NAICS code 333914 [Due to merges from the four digit codes]
  • 333911: Pump and Pumping Equipment Manufacturing à 333914 Measuring, Dispensing, and Other Pumping Equipment Manufacturing
    • Measuring and Dispensing Pump à Measuring, Dispensing, and Other
  • 333913: Manufacturing à 333914 Pumping Equipment Manufacturing
  1. 2012 NAICS codes 512210 and 512220 à 2017 NAICS code 512250 [Merged Industries]
  • 512210 Record Production à 512250 Record Production and Distribution
  • 512220 Integrated Record Production/Distribution à 512250 Record Production and Distribution
  1. 2012 NAICS code 517110 à 2017 NAICS code 517311
  • 517110 Wired Telecommunications Carriers à 517311 Wired Telecommunications Carriers
  1. 2012 NAICS code 517210 à 2017 NAICS code 517312 [Changed without changing definitions or titles]
  • 517210 Wired Telecommunications Carriers (Except Satellite) à 517312 Wired Telecommunications Carriers (Except Satellite)
  1. 2012 NAICS code 541711 will correspond to 2017 NAICS codes 541713 and 541714 [New industries were created by splitting two industries into two parts with one part of each industry defined as a separate industry and combining other parts of the two industries to form a separate new industry]
  • 541711 Research and Development in Biotechnology will correspond to 541713 Research and Development in Nanotechnology and 541714 Research and Development in Biotechnology (except Nanotechnology)
  1. 2012 NAICS code 541712 will correspond to 2017 NAICS codes 541713 and 541715
  • Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology) will correspond to 541713 Research and Development in Nanotechnology and 541715 Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology)

Senate Small Business Committee Highlights Tax Burdens on Small Businesses

Last week, the Senate Small Business and Entrepreneurship Committee took up one of the most important issues for Congress this year—tax reform. The committee held a hearing on tax reform to address the code’s current barriers to small business growth. Witnesses testifying before the Committee included Mark Mazur, director of Urban-Brookings Tax Policy Center, Annette Nellen, chair of the American Institute of Certified Public Accountants (AICPA), and Brian Reardon, president of S Corporation Association.

Both the majority and minority voiced the importance of the small business voice when considering tax reform. Chair James Risch (R-ID) began the hearing by pointing to a grim fact: tax compliance costs are 67% higher for small businesses. Due to these extraordinary costs, roughly 89% of small business owners have to rely on outside assistance to comply with the tax code. As we all know, time is money. Ranking Member Jeanne Shaheen (D-NH) commented on the length and complexity of the tax code, pointing out that small businesses spend 2.5 billion hours complying with IRS rules. These hours are valuable time wasted on compliance that could be used for growing a business.

Too Much Time and Too Much Money

Questions from members of the committee centered around the increased burdens and costs of tax compliance that small businesses experience. Annettee Nellen from AICPA highlighted in her testimony that tax relief should apply to all businesses, not just C-corps. This is at the core of WIPP’s policy recommendations: to reform the tax code to make deductions and credits equitable, no matter the structure of the company. Mark Mazur, director of the Urban-Brookings Tax Policy Center, added that the current tax system is “woefully” out of date as it applies to business income. In changing the tax code, Congress will have to look at how different the economy is today from the last time the code was revised, he advised. As pointed out in WIPP’s 2017 Economic Blueprint, pass through entities are subject to a top individual tax rate of 43.4%, and with state and local tax rates ranging up to 13.3%, this significantly hampers business growth.

Institutional Barriers for Women

Ranking Member Shaheen referenced research conducted by WIPP and American University’s Kogod Tax Policy Center. “The last time the tax code was updated, there were only four million women-owned small businesses,” said Shaheen. “Today, there are 11.3 million, making up 38% of firms in this country.” She noted that Congress does not have enough information on women-owned businesses citing the Kogod study, Billion Dollar Blind Spot, asking the panel how Congress and the administration can improve the tax code for women business owners. Mazur agreed, noting that additional resources should be allocated by the IRS to determine barriers for women-owned businesses.

There is certainly agreement from both sides of the aisle that it is time for a change when it comes to tax reform and that the concerns of small businesses should be taken into consideration. This was the first of many conversations that will take place on this critical issue.

To read the written testimony from the hearing, click here.

To read the WIPP and Kogod tax study, click here.

To read WIPP’s 2017 Economic blueprint, click here.

Writing YOUR Success Story

By Linda McMahon, SBA Administrator

Once upon a time….

It’s the classic opening to our favorite fairy tales. As children we dream of magic potions and knights in shining armor that will provide our happily ever after. How were we to know thalinda-mcmahon-high.jpgt our own hard work, skill and determination could be far more effective?

Once upon a time, my husband and I started our business sharing a desk. As he developed our product and expanded our markets, I managed the books. When the work became too much for the two of us to handle ourselves, we hired our first employee. As our business grew, we hired another. Then another. Over decades of hard work growing our business, that company we created now has grown to a publicly traded enterprise with more than 800 employees and consumers in 180 countries worldwide.

As an entrepreneur, I have truly lived the American Dream: the classic tale of taking a risk on an idea, working hard and creating something from nothing. Don’t get me wrong – we had plenty of stumbles and challenges that provided the plot twists along the way. But it’s a story I am always proud to tell.

And as head of the U.S. Small Business Administration, my goal now is to help more people have the opportunity to live the American Dream.

Yet many aspiring entrepreneurs have no idea how to get their stories started or write their next chapters.

The SBA is here to help, with resources both online and in communities from coast to coast.

During National Small Business Week, as we celebrate the 28 million small businesses that drive our nation’s economy, we also showcase the resources and services the SBA provides to entrepreneurs at every stage, whether they are starting up, expanding or getting through a tough time.

The SBA has 68 district offices and an extensive network of resource partners across America, including Puerto Rico, the U.S. Virgin Islands, and Guam. The experienced professionals that staff these offices offer a core group of services that we call the “three Cs and a D” – capital accesscounselingcontracts, and disaster assistance.

Many entrepreneurs need capital to start or expand their small business, combining what they have with other sources of financing. While the SBA doesn’t loan money directly to small business owners, it helps facilitate loans with a guaranty that a certain portion will be repaid. We offer counseling on starting, scaling and succeeding in business, from how to draft a business plan to how to export your product overseas. And we train small businesses on how to compete for government contracts, especially those set aside exclusively for small business owners. Finally, SBA provides a helping hand to small businesses recovering from disasters.

As I think back on my own story as a small business owner, I wonder how much easier things might have been if we’d been aware of the many valuable services SBA provides. My hope is that as more people learn about the SBA, they will have the confidence, skills and resources they need to succeed as small business owners, and we can continue to revitalize a spirit of entrepreneurship in our country.

There’s room for far more success stories in our library.

And the SBA can help more entrepreneurs write their own “happily ever after.”

Linda McMahon serves as the 25th Administrator of the U.S. Small Business Administration.

 

 

 

Washington has many great traditions but this one must go

By Ann Sullivan, WIPP Chief Advocate

If you keep a close eye on Washington from year to year, you’ll notice some traditions that always take place. The annual White House Easter Egg Roll in the spring, when children gather to race eggs with wooden spoons down the South Lawn. The Congressional baseball game in the summer, when House Republicans face off against House Democrats at the Nationals park to raise money for charity.

And, of course, the talk of a looming government shutdown any time the previous funding mechanism is about to run out—a tradition that affects so much more than the District of Columbia.

We’ve heard it before and we’ll hear it again—If Congress doesn’t find a way to fund the government, it will shut down. In true fashion, with the deadline to pass a bill set for last Friday, April 28, Congress gave itself a little more time by passing a week long Continuing Resolution—until May 5, without altering the terms or conditions that apply to funding.

And then—a welcome break in tradition. Congressional negotiators in a bipartisan fashion, finalized a $1.1 trillion spending bill, keeping the government funded through September.

While a government shutdown rarely actually happens—when it does—it is not good for women business owners. In fact, it isn’t good for anyone. When federal contractors can’t get paid, they can’t pay the people who work for them. When they can’t pay the people who work for them, they can’t produce any work. The contractor suffers, the jobs she’s created suffer, and the economy suffers.

However, some contractors don’t have the option of laying off their employees during a shutdown. WIPP Board Chair Lisa Firestone struggled with this firsthand. In 2013, Lisa testified before Congress about the negative impact that year’s shutdown had on her business, as well as other women federal contractors. Because her company provides “essential” services, her employees continued to work and get paid during the duration of the government shutdown that year. Despite knowing she eventually would get paid from the government, there was no way to know when. She’s not the only one.

Many small business owners face this same problem and face the stress of preparing to maximize available cash in advance of a potential shut down. Between the options of a shutdown and a Continuing Resolution, a Continuing Resolution is the lesser of two evils. But, it may not be so great for women contractors either.

Continuing resolutions curb new government spending and, thus, new government projects. We know firsthand from our members that operating under a Continuing Resolution results in project delays as well. Since many agencies can’t open expired contracts for new bids, they often turn to uncompetitive bridge contracts with existing vendors to keep services moving. The problem is, according to the Department of Commerce, women-owned firms are 21% less likely than their male-owned counterparts to win government contracts. Given this significant barrier to entry, access to contracts is further exacerbated by this method of procuring goods and services.

The impact of a shutdown is harsh on contractors. If the government is your customer, the consequences are immediate. The Department of Homeland Security in the 2013 shutdown issued a warning to its contractors: “…as a consequence of the lapse, certain planned procurements may be canceled and certain existing contracts may be stopped, reduced in scope, terminated or partially terminated.” Not to mention, the chaos created with respect to lending. Since lenders rely on the IRS to verify income, lending was stopped dead in its tracks.

Let’s get rid of this tradition. Successful businesses plan ahead and so should Congress. The wide-reaching consequences spurred by Congressional inaction of a timely budget are significant. Contracts that aren’t funded by prior appropriations and aren’t essential probably will be put on hold during a shutdown – while contractors that are essential will have to continue to work, but while having to bear the cost of their employees’ salaries. The business community should be spending all of its capital expanding, not saving up for a possible government shutdown. Despite the good news for the remainder of Fiscal Year 2017, the fight has just begun for Fiscal Year 2018. It’s time for Congress to put together a plan to fund the government without worry of a shutdown or relying on Continuing Resolutions again and again so entrepreneurs can worry about what matters – running their business.