Small Business Venture Capital Act

Small Business Venture Capital Act - Title I: Amendments of the Small Business Investment Act of 1958 - States that the interest rate on loans guaranteed by the Small Business Administration (SBA) to small business investment companies shall be three percent per annum.

Authorizes the Small Business Administration to guarantee up to 75 percent of the funds advanced by small business investment companies to start small business concerns. Limits such guarantees to not more than 25 percent of the private paid-in capital of the small business investment company.

Makes the Associate Administrator for Investment of the SBA responsible for the administration of the small business investment program and removes any other duties.

Permits small business investment companies to recognize, for accounting purposes, specified non-cash gains and the proceeds from the issuance of capital notes when such notes have a maturity of at least ten years.

Title II: Amendments of Securities Acts - Amends the Securities Act of 1933 to permit the issuance of securities without registration if the issuance qualifies as a limited offering as defined by this Act.

Permits the sale of restricted securities without registration provided; (1) the issuer is a reporting company under the Securities Exchange Act of 1954; (2) the securities are fully paid for and held for a minimum of two years before a sale; and (3) not more than one percent of the outstanding securities of the issuer of the same class is sold in any three month period.

Increases the small offering exemption from $500,000 to $3,000,000.

Amends the Investment Company Act to add small business investment companies to the classes of persons excepted from the definition of "investment company" under such Act.

Title III: Amendment of the Employee Retirement Income Security Act of 1974 - Amends the Employee Retirement Income Security Act to provide that the prudence requirement under such Act is not violated solely because an investment may be in a venture capital organization or in a small business, provided investments of this nature do not exceed in value two percent of the market value of all assets in a defined benefit plan fund.

Title IV: Amendments of the Internal Revenue Code of 1954 - Sets forth a six-step corporate tax rate structure with a tax of eight percent on net income not exceeding $30,000, increasing the tax rate at eight point intervals for each additional $30,000, and a maximum rate of 48% applying to net income of $150,000, or more.

States that the gain from the sale of an interest in a small concern qualifies as a non-taxable exchange provided such gain is reinvested within two years of the sale in another eligible small concern.

Makes changes with respect to the computation of depreciation.

Repeals the amendments pertaining to qualified stock options under section 442 of the Code as enacted by the Tax Reform Act of 1976 and reinstates the former law.

Doubles the allowable deduction for any taxable year with respect to the issuance of small business stock.

Increases to 25 the allowable number of shareholders of subchapter S corporations. Permits a small business investment company to be a shareholder in such corporations. Eliminates the passive income test pertaining to qualification of such corporations.

Permits small business companies to elect to be taxed as regulated investment companies.