The current tax laws and practices of the IRS are hurting small businesses, especially women-owned businesses, two Utah female business owners told a Senate committee Thursday.
Not only did the the women feel strongly about what they had to say - they said it in an unusual way.Their testimony was part of a first-time high-tech committee hearing that presented the ideas of Americans in their communities to Beltway leaders via satellite. The hearing also allowed the audience to submit comments to the committee through a chat room on the Internet.
Sen. Bob Bennett, R-Utah, arranged for the Senate Committee on Small Businesses to be linked from Washington to speakers in Salt Lake City and St. Louis, Mo.
"For many entrepreneurs who are busy building small businesses and under heavy constraints of time, money and distance, access to lawmakers in Washington is often difficult," Bennett said.
Bennett asked Committee Chairman Christopher Bond, R-Missouri, agreed to try using technology to erase those problems and let business owners address leaders directly during the hearing titled "IRS Reform: What America's Taxpayers Need Now."
Bennett wanted Utahns included in the hearing as an extension of a conference on women business owners he had hosted in Salt Lake City last month.
Participants included three Missouri business owners, two business owners testifying in Washington and two Utahns. The hearing site in Salt Lake City was the office of Electricwave in the Triad Center.
Taking part on the Utah end were Nancy Workman, a general engineering contractor and Salt Lake County Recorder, and Elizabeth Nielson, a CPA and member of the local chapter of the National Association of Women Business Owners.
"When one goes into business one now has to file not one return per year. Now you have to file four returns a year," said Workman. "You have to estimate four time a year how much you believe you are going to earn during the year and pay on it before you get it. If you are wrong, the IRS can make it ugly."
Workman said women business owners are especially cautious because they're terrified of the IRS and its wide-ranging powers. "They don't want to get into anything or do anything that could trigger an audit. Not that they are doing anything illegal, but that the IRS can tear into them and they don't have the know-how or resources to fight such a huge powerful organization."
Nielson, who owns a CPA firm, said she worked early in her career as a revenue agent for the IRS and has since helped many of her own clients with tax problems. "Since that time understanding and complying with tax laws have been a major part of my business; however, I would gladly give up that revenue for a better tax system," Nielson said.
Nielson said the frustrations business owners face stem in large part from the complexity of the tax system and the many laws covering different businesses. "The first step in tax reform is to simplify the current system," she said.