New legislation could improve the IRS' report card when it comes to considering the needs of small business.
Regflex isn't the latest exercise trend-'s a law designed to make sure federal agencies address the needs of small business when they issue rules and regulations. The Regulatory Flexibility Act (RFA) requires agencies to determine whether their proposed and final rules will have an economic impact on small business and to examine less burdensome alternatives if the impact is deemed significant. So far, however, small-business advocates say the IRS is not keeping up its end of the deal.
To bring the IRS into better compliance, the House Committee on Small Business recently held hearings on the issue. Ranking Democratic member Rep. Nydia M. Velázquez (NY) is especially concerned about the financial impact tax regulations are having on entrepreneurs. "Despite the fact that the IRS is responsible for the highest regulatory costs impacting small businesses, it has been the worst violator of applying RegFlex analysis," she contends. The cost per employee with regard to small-business tax compliance topped the costs for large companies by 114 percent, she says.
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