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  • Plain Language in Paperwork – The Benefits to Small Business
    ten employees or less I can tell you that in each of these hats I wear confusion and complexity surrounding government forms and publications is foremost And no where else is this confusion more prominent than in the documentation churned out by the Internal Revenue Service While lack of clarity in forms and publication flourishes in the federal government the IRS is the federal agency that micro businesses have the most contact with and of course are most fearful of It is also the most infamous for their excessive paperwork and unclear instructions and forms Though I will note that as a CPA I have been very pleased with the efforts made by the Internal Revenue Service over the past few years to become small business friendly The IRS s enhanced outreach and educational efforts as well as their work in the Office of Burden Reduction to simplify and minimize paperwork have made positive strides Their commitment to their website and the availability of information has been very good and certainly recognized by the NASE and many small business owners However despite steps toward improvement with over 1 4 million words the tax code is so convoluted that is extremely difficult for taxpayers tax practitioners and the IRS to reliably and accurately comply with or enforce the breadth of tax regulations Currently the IRS estimates that a self employed taxpayer one filing Form 1040 with corresponding Schedule C will have to spend on average over 56 9 hours in preparation and filing of their returns this year with an average cost of 440 dollars According to a 2006 Tax Foundation study individuals businesses and nonprofits spent an estimated 6 billion hours complying with the federal income tax code with an estimated compliance cost of over 265 1 billion Businesses bear the majority of tax compliance costs totaling nearly 148 billion or 56 percent of total compliance costs The majority of NASE members are one to three person businesses with over half working from their home This is a very unique segment of the business population in which many do their taxes on their own with assistance from tax preparation software Thus the NASE wanted to find out what our micro business members felt about the current tax code In March of 2006 we conducted a survey to determine which factor of the federal tax code they found most burdensome Overwhelmingly respondents indicated that it was the complexity of the tax code and tax forms Additionally these members indicated that the simplification of the tax code is what they would most like to improve about our current system The IRS Form 4562 which relates to Depreciation and Amortization and its corresponding publications are a prime example of vague forms and publications that would benefit from simplification and plain language A small business owner who purchases a 1 500 computer will have to read 16 pages of obscure instructions to fill out this two page form Additionally the IRS indicates that the

    Original URL path: http://selfemployed.nase.org/nase-in-action/advocacy/2008/02/27/Plain_Language_in_Paperwork_%E2%80%93_The_Benefits_to_Small_Business (2016-02-14)
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  • NASE Submits Testimony Addressing the Issue of Affordable Health Coverage
    role in premium increases First I would like to highlight that the self employed and micro businesses purchase health insurance in two markets the small group market and the individual market The definition of a small group is determined by each state though most define it as one with 50 or fewer employees Firms in this size range looking to offer access to health insurance for their employees will look to the small group market for insurance options However of those currently insured the majority of self employed and micro businesses have purchased individual health coverage While micro businesses surveyed by the NASE indicate that they believe it is an employer s responsibility to assist their employees with health coverage the high cost to both the business and the employee in terms of cost sharing are the most significant barriers impeding business owners from providing employees with coverage Micro businesses may assist their employees with their health care costs by setting up a Health Reimbursement Arrangement HRA contributing to an HSA or increasing their take home salary to help employees pay for individual insurance but a large percentage are not setting up an employer based small group health plan The health insurance options and number of carriers differ in the individual and small group market Most states have a suitable number of insurance carriers with an array of coverage options within the individual market The small group market is much more restrictive in terms of competition and availability The NASE believes that minimization of insurance carriers due to consolidation compounded with the concern of high risk in this small group segment and excessive state regulation leaves small businesses with minimal options to set up a small group health plan and is a factor contributing to high premiums in insurance markets A 2005 GAO report highlighted that the median market share of the largest carrier in the small group market was 43 up 10 from 2002 The five largest carriers in the small group market when combined represented three quarters or more of the market in 26 of the 34 states that participated in the GAO study compared to only 19 of 34 states in 2002 Blue Cross and Blue Shield is by far the giant in this sector growing to 44 market share in all participating states To support the GAO findings we see similar depictions of lack of competition from a 2006 AMA study on the nation s health insurance markets which found that 95 percent of markets had a single insurer with a market share of 30 percent or greater and 56 of markets had a single insurer with a market share of 50 percent or greater From the data we see a notable dominance of a few carriers in the small group market Thus the next question that begs an answer is how this lack of competition is affecting premiums Any micro business owner will tell you that competition plays a central role in improving quality spurring

    Original URL path: http://selfemployed.nase.org/nase-in-action/advocacy/2007/10/26/NASE_Submits_Testimony_Addressing_the_Issue_of_Affordable_Health_Coverage (2016-02-14)
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  • NASE Submits Testimony Regarding the Small Business Administrations (SBA) Micro-Loan Program
    of credit put the owner and the business at risk High and fluctuating interest rates can increase debt and affect the ability of the business owner to pay back the money This in turn can negatively affect a microbusiness owner s credit score creating another obstacle towards qualifying for loans Twenty six percent of our membership indicated that they believe their credit score was their biggest barrier to obtaining financing In addition to those entrepreneurs with lower than required FICO scores many also do not have extensive credit histories which influences their ability to be considered for a loan Overall the reliance on FICO credit scoring by traditional lending resources to examine potential borrowers is a critical hurdle faced by micro businesses With all of this said the one shining beacon of opportunity for a micro business owner in the challenging realm of business financing is the Small Business Administration s loan programs such as the Micro loan program This program addresses all of the above barriers that affect access to capital for micro businesses and gives them a chance to start and grow their business While banks are an important component in the program due to their work with microlending intermediaries micro business owners applying for financing through the Micro loan program are not subject to the biases or barriers of traditional lending institutions They are able to work with community based non profit intermediaries whose sole focus is to assist them in their endeavor of starting a micro business Microlending intermediaries offer financing opportunities via the SBA Micro loan program for those needing small amounts of capital under 35 000 and for entrepreneurs with lower credit scores or minimal credit history Most importantly these intermediaries have essential expertise on the needs of this key demographic The technical assistance component to the Micro loan program is a crucial element which enables intermediaries to assist micro business owners step by step through the development and growth of their business This training and assistance not only increases the likelihood of full repayment of the loan but increases the likelihood for business survival and success The National Association for the Self Employed strongly supports the Micro loan program and we have consistently advocated for increased funding lower lender and borrower fees and improvements upon SBA loan programs Based on our initial review the NASE is supportive of the Committee s draft legislation to improve upon the SBA Micro loan program In particular the NASE is pleased to see the bill include provisions to facilitate the transmission of credit reporting information by establishing a process for intermediaries to provide information to the major credit reporting agencies about a borrower s payment records This would significantly assist in adding to and improving upon a micro business owner s credit history As a membership organization representing micro businesses I cannot express to you more intently the importance of the SBA loan programs especially the Micro Loan program In fact access to financing is so critical

    Original URL path: http://selfemployed.nase.org/nase-in-action/advocacy/2007/07/13/NASE_Submits_Testimony_Regarding_the_Small_Business_Administrations_SBA_Micro-Loan_Program (2016-02-14)
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  • NASE Submits Written Testimony on Decreasing the Tax Gap without Increasing Small Business Burdens
    show up on their bank statements anyway It is clear that the sales via credit cards are well documented and would be revealed upon review and therefore it is unlikely that those amounts would be the key source for intentional underreporting Additionally this new level of regulatory burden place on credit card issuers will likely lead to increased fees being passed on to businesses which conduct credit card transactions Increased fees will have a negative impact on revenues and sales of micro business owners Therefore the NASE is concerned that this approach may not be targeting the source of underreporting and could serve to increase the costs associated with credit card usage without identifying any additional taxable income that would not have already been reported Requirement on Businesses to Obtain and Verify a Certified Taxpayer Identification Number for Contractors Under the current system businesses that pay contractors non employee providers 600 or more for services in a calendar year are required to file an information return Form 1099 to the IRS and contractor at the end of the year The information on that return is not verified by the IRS In the FY2008 Budget the Administration recommends that a contractor be required to furnish to the business on Form W 9 the contractor s certified Taxpayer Identification Number TIN The business would then be required to verify the contractor s TIN with the IRS which would be authorized to disclose for this purpose only whether the certified TIN name combination matches the IRS records If the contractor fails to furnish an accurate certified TIN the business would be required to withhold a flat rate percentage of gross payments to that contractor The NASE supports the requirement of a TIN number to be furnished by the contractor to the business on Form W 9 However we have trepidation regarding the requirement on businesses to verify a contractor s TIN and withhold if it is inaccurate Our concern lies in the lack of specifics as to what type of system the IRS plans to set up for businesses to fulfill this requirement A system with substantial paperwork for requests and long wait times to receive needed approvals would impair businesses and self employed contractors If the IRS produces a user friendly quick response TIN name match system via online or phone then the NASE would have minimal objections to this proposal However the NASE feels that there is still the potential for increased compliance issues due with this system The Department of Treasury is asking business owners to be in part IRS compliance officers a role for which they are not trained for The additional regulatory burden could cause an increase in unintentional errors if Taxpayer Identification Numbers or names are accidentally reported inaccurately by business owners contractors and the IRS Voluntary Withholding at the Request of Contractors Included in the above proposal is the creation of a voluntary withholding system Contractors receiving payments of 600 or more in a calendar year

    Original URL path: http://selfemployed.nase.org/nase-in-action/advocacy/2007/04/27/NASE_Submits_Written_Testimony_on_Decreasing_the_Tax_Gap_without_Increasing_Small_Business_Burdens (2016-02-14)
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  • How Should We Reform the Tax System? (March 2009)
    Links ASBDC Member Directory Search My NASE About Me Account Benefits Optional Benefits Payment Details Expert Questions Email Subscriptions Membership Directory NASE Survey Results Topics that Are Important to Small Business Owners Here s a snapshot of how micro business owners feel about the hot topics of the day View all NASE news How Should We Reform the Tax System March 2009 Wednesday April 01 2009 Respondents 399 Taxes have long been a source of frustration for the self employed With April 15th looming a spotlight is shined on the need for reforming our federal tax system The National Association for the Self Employed has long supported tax simplification and tax fairness for micro businesses Please take this short member survey regarding your opinions on federal tax reform 1 How do you prepare your taxes 55 I use a tax practitioner account 09 I utilize electronic filing 28 I utilize tax software on my computer 05 I calculate my taxes and fill out the forms by hand 03 Other 00 Do Not Know 2 Approximately how many hours do you spend preparing your taxes Check only one 27 1 5 hours 15 5 7 hours 15 8 10 hours 07 10 15 hours 08 15 20 hours 07 21 25 hours 03 26 30 hours 05 31 40 hours 03 41 50 hours 00 51 75 hours 0 76 99 hours 01 Over 100 hours 07 Do Not Know 3 Which factor below do you feel is the most burdensome aspect of the federal tax code Check only one 07 Amount of paperwork you must fill out 35 The complexity of the tax code and tax forms 12 The lack of consistency continuously changing regulations 19 The tax rates how much in taxes you must pay 11 The inequality within

    Original URL path: http://selfemployed.nase.org/nase-in-action/nase-research/nase-member-survey/2009/04/01/How_Should_We_Reform_the_Tax_System_March_2009 (2016-02-14)
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  • Have You Ever Gone Without Health Insurance? (Feb 2009)
    Important to Small Business Owners Here s a snapshot of how micro business owners feel about the hot topics of the day View all NASE news Have You Ever Gone Without Health Insurance Feb 2009 Sunday March 01 2009 Respondents 242 Currently 46 million Americans have no health insurance with 60 percent of uninsured Americans representing owners employees or dependents of those working in small business With the economy continuing to decline micro business owners like you are making tough choices about how to keep their business afloat Some are dropping health coverage due to the added cost burden Please take this short member survey to assist us on determining how this impacts you and your business 1 Do you currently have health insurance 74 Yes 25 No 01 Do Not Know 2 If no what is the chief reason you do not have health coverage Choose only one 29 Cost affordability 01 A lack of quality health insurance plans or providers in my area 01 Too difficult to deal with the paperwork and administrative burden of health insurance 02 Do not know where to find health insurance coverage 00 Do not think I need coverage at this time 08 Other 58 No opinion 3 Have you been uninsured at any point in time 71 Yes 27 No 02 Do Not Know 4 What best describes the chief reason you were uninsured Choose only ONE 18 Unemployed Between jobs 44 Unable to afford health insurance premiums 05 Illness Health problem that prohibited you from obtaining coverage 00 Spouse or family member health coverage did not cover dependents 02 Did not know how to get health coverage 04 Did not think I needed coverage at the time 03 Other 24 No opinion 5 Which of the following below would MOST encourage

    Original URL path: http://selfemployed.nase.org/nase-in-action/nase-research/nase-member-survey/2009/03/01/Have_You_Ever_Gone_Without_Health_Insurance_Feb_2009 (2016-02-14)
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  • Should Federal Small Business Programs be a Priority in the new Obama Administration? (Jan 2009)
    of Return Calculator Mortgage Mortgage Loan Calculator Retirement Savings and Planning 401 k Calculator How long will my retirement savings last Tax 1040 Tax Calculator Payroll Deductions Calculator Self Employment Tax Calculator Helpful Links ASBDC Member Directory Search My NASE About Me Account Benefits Optional Benefits Payment Details Expert Questions Email Subscriptions Membership Directory NASE Survey Results Topics that Are Important to Small Business Owners Here s a snapshot of how micro business owners feel about the hot topics of the day View all NASE news Should Federal Small Business Programs be a Priority in the new Obama Administration Jan 2009 Saturday January 31 2009 Respondents 192 The NASE has long been a fervent supporter of federal small business programs that have a proven track record of efficiently aiding the self employed and micro businesses such as the SBA Office of Advocacy the Small Business Development Centers and SCORE With a new administration about to take office there is opportunity to improve and expand current small business federal programs Please take this short member survey regarding your experience and opinions on these programs 1 Please indicate which of the following small business assistance programs and services supported by the federal government that you are aware of Check all that apply 18 Small Business Development Centers SBDCs 10 Women Business Centers 14 SCORE Service Corps of Retired Executives 20 SBA Business Loan programs Basic 7 a loan Micro Loan 504 loan 02 Office of the National Ombudsman for Fair Enforcement of Federal Regulations 06 SBA Office of Advocacy 06 IRS National Taxpayer Advocate 07 Department of Labor s Office of Small Business Programs 17 None 2 Have you ever utilized any services or programs listed above to assist you with any aspect of starting and managing your business 27 Yes 71

    Original URL path: http://selfemployed.nase.org/nase-in-action/nase-research/nase-member-survey/2009/01/31/Should_Federal_Small_Business_Programs_be_a_Priority_in_the_new_Obama_Administration_Jan_2009 (2016-02-14)
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  • How Do You Handle Tough Economic Times? (Nov 2008)
    Planning 401 k Calculator How long will my retirement savings last Tax 1040 Tax Calculator Payroll Deductions Calculator Self Employment Tax Calculator Helpful Links ASBDC Member Directory Search My NASE About Me Account Benefits Optional Benefits Payment Details Expert Questions Email Subscriptions Membership Directory NASE Survey Results Topics that Are Important to Small Business Owners Here s a snapshot of how micro business owners feel about the hot topics of the day View all NASE news How Do You Handle Tough Economic Times Nov 2008 Sunday November 30 2008 Respondents 515 As the economic crisis facing our nation and the world continues to deepen the self employed and micro business owners will have to make tough decisions regarding the operation of their business Please take this short survey to tell us how you are presently handling or plan to address the tough economic times ahead 1 How much of an impact is the slow economy having on your business at the present time 50 Significant impact on my business 21 Moderate impact on my business 19 Slight impact on my business 08 No impact on my business 02 No Opinion 2 In your current business how does this economic downturn compare to previous periods of a slowing economy 43 This economic downturn is the worst I have experienced 16 This economic downturn is similar to hard economic times I have experienced previously 06 This economic downturn is not as bad as hard times I have experienced in the past 26 This economic downturn is the first I have experienced with my current business 08 No opinion 3 What actions in your business are you considering to address the difficult economic climate Choose ALL that apply 10 Lower prices of products and or services 17 Scale back the purchase of inventory

    Original URL path: http://selfemployed.nase.org/nase-in-action/nase-research/nase-member-survey/2008/11/30/How_Do_You_Handle_Tough_Economic_Times_Nov_2008 (2016-02-14)
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