Senator Sharon Runner (R-Antelope Valley) announced Wednesday her legislation benefitting small business owners and employees passed the Senate Governance and Finance Committee.

Senate Bill 1272 would establish an Employee Savings Match Plan to credit small business owners that match contributions by employees who participate in payroll based savings.

“Millions of salaried employees, especially young and low income workers, live week to week without anything in savings to address even a small emergency,” said Runner. “SB 1272 provides these individuals the chance to get ahead and plan for their financial future.”

Under SB 1272, the Employee Savings Match Plan would create tax incentives for participating small businesses by providing a partial tax credit for matching amounts contributed to an employee’s savings account. The program would be limited to businesses with fewer than 100 employees and require that at least half of the participating employees earn less than $40,000 per year. Small businesses that match the amounts their employees save, up to $2,000 per employee per year, would be eligible for a 50% tax credit.

SB 1272 passed with the help and support of Senator Janet Nguyen (R-Garden Grove), Vice Chair of the Senate Governance and Finance Committee.

“The ease of contributing to a payroll savings plan often motivates people to start saving,” said Nguyen. “With a tax credit for employer contributions, SB 1272 is a win for both small businesses and their employees.”

SB 1272 passed with unanimous, bipartisan support and now moves to the Senate Appropriations Committee.