One of the provisions under consideration in the tax extenders discussion is a reinstatement of 50 percent bonus expensing for equipment. This would strengthen investment spending and boost the sluggish recovery. It has...
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- Tax Paperwork Burden on Small Businesses Continues to Rise
Tax Paperwork Burden on Small Businesses Continues to Rise
For small business owners, the onerous chore of filing taxes can be confusing, time consuming, and expensive—and it’s only getting worse. On May 25, Leonard Steinberg, of the Small Business & Entrepreneurship Council, testified before the U.S. House Committee on Government Reform, Subcommittee on Regulatory Affairs, explaining the shortcomings of the Internal Revenue Service’s paperwork reduction efforts.
In 1980, the year the Paperwork Reduction Act became law, the individual form 1040 instruction booklet contained approximately 45 pages and the form itself contained 68 lines. By 2004, the instruction booklet had grown to a staggering 128 pages, and the form contained 75 lines.
If the objective is to reduce paperwork, this objective has failed. The small business community still spends a disproportionate share of resources (time, personnel and dollars) in order to comply with the regulatory process.
These additional costs are either passed on to the consumer or deducted from the small business owner’s ability to pay himself/herself an adequate wage or give well-earned raises to the employees
Steinberg urged the committee members to modify the Paperwork Reduction Act to ease the burden on small businesses, reminding them that, “The issue of burden on small businesses falls squarely within the domain of the Congress. The IRS can only implement the will of the Congress.”
Read the full testimony here. Also, see the Tax Foundation’s testimony before the House Small Business Committee.
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