Small Business Capital Formation, Capital Retention, and Expansion Act of 1980

Small Business Capital Formation, Capital Retention and Expansion Act of 1980 - Amends the Internal Revenue Code to allow small businesses an income tax credit equal to 50 percent of the cash contributions to a business expansion reserve. Limits the amount of such credit to $300,000 for a taxable year.

Requires that expenditures made from such reserve be used to acquire, construct, reconstruct, or erect depreciable business assets or to provide for employee wage increases. Permits the accumulation of amounts of capital in the business expansion reserve for up to five years without tax penalty.