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State legislators, officials and small-business owners and advocates have agreed to work toward a number of key changes designed to ease the paperwork burdens many entrepreneurs face and to make more capital available.
The agreement was hammered out at the 13th National Legislative Conference on Small Business Issues, held in San Diego in December.
Among the concerns addressed was creating one form that both federal and state governments will accept for payroll tax filing, says Jere Glover of the Small Business Administration's Office of Advocacy.
"There's no reason to report the same information in slightly different formats to different agencies," insists Glover, adding that states that are interested in exploring the idea include Arkansas, Hawaii, Maryland, West Virginia and Wisconsin. Montana has already consolidated its state-required forms and also wants to work with the federal government.
To facilitate this streamlining effort, Glover says that for the first time the IRS has agreed to accept payroll information from the states. Glover believes this action could reduce by one-third the time entrepreneurs spend filing payroll tax information.
"We also discussed states depositing their money in banks that lend to small businesses," says Glover. "Some states already do that. We gave New York an award because the state legislature passed a law that says if a bank agrees to increase its lending to small business, the state will give those banks priority [consideration as places to keep state money]."
Glover's office estimates this action by states could increase the amount of capital available to small businesses.
In addition to these issues, Glover says governors and state legislators have voiced a strong consensus to follow the federal government's lead of reducing paperwork requirements for small businesses by 25 percent over the next three years.
The small-business advocate believes the net result of all this reduction is a big gain for entrepreneurs, who will be able to spend more time running their companies.