From the January 1999 issue of Startups

Several provisions in the fiscal 1999 federal budget offer entrepreneurs tax and health-care relief . . . as well as a special break for small-business owners using the Internet. Thanks to the Internet Freedom Act, you won't have to worry about new state or local taxes for three years, as local governments are prohibited from imposing any new Internet access taxes and from levying "discriminatory taxes" on transactions not similarly taxed in non-Internet commerce. For example, if entrepreneurs selling across state lines are currently not taxed by the state they're selling in, new taxes can't be passed.

In addition, the act creates the Advisory Commission on Electronic Commerce, which is composed of representatives from industries and state and local governments, to study Internet taxation. The commission will solicit public commentary (to be given to Congress) and issue recommendations in 18 months.

Other provisions in the new budget allow self-employed workers to:

*deduct 100 percent of their health insurance premiums for themselves and their families in 2003 instead of 2007. The acceleration also changes the level of deductibility for other years: You can deduct 60 percent of the cost from 1999 to 2001, and 70 percent in 2002. This doesn't apply if your company is a corporation and you are one of its employees;

*deduct research and development costs for an additional year (the tax credit has been extended until June 30); and

*continue to obtain a tax credit by hiring hard-to-place low-income people under the Work Opportunity and Welfare-to-Work programs. This deduction was scheduled to end in April but has been extended through June.