I hear a lot about cutting the corporate tax rate as a fix for unleashing small business. Non of the small business owners I know (myself included) are affected by the corporate tax rate. We are mostly S-Corporations. That means the tax burden is passed on to my personal income tax via K-1. I have to pay a firm over $25,000 per year just to file the 300+ pages in tax returns. That's on top of the 30+ percent of my annual hard earned revenue that we have to pay each year. How can you lessen that burden?
Bob Fitzgerald (Newport News, VA) BOSH Global Services
I'd wholeheartedly support any efforts to streamline the tax code and reduce the beaucracy that small business owners have to deal with. I own a small government contracting company, and am in the middle of a full blown DCAA audit, just finished an OFCCP audit, and two tax 'reviews' within the last quarter --- of course this all means bringing in the outside consultants and paying them instead of doing 'productive' work. I can't imagine how productivity would skyrocket (and REAL costs would go down) if the tax code were simply "give me 15% of what you earned" (or whatever number makes the budget BALANCE).
Van Sullivan (Huntsville, AL) Trideum Corporation
I would be interested in hiring an employee and growing my business if it weren't for all the regulations and tax complications. Instead, I will remain a sole proprietor and not worry about it. Maybe if the tax code is ever fixed I will reconsider the risks/rewards.
Albert Wiersch (Dallas, TX) AI Internet Solutions
I've been in business for 12 years, still don't fully understand the taxes, and have really struggled as a result. Tax reform would not only help us, it would help you guys. When business is successful you collect your taxes, when we can't get it together everyone loses. You guys are way overdue for this.
Katherine Trent (Norman, OK) Liberty Child Care
The most important obstacle to growth that small businesses face, especially those that have S Corp or LLC status, is the fact that we are taxed on our businesses' net income whether said income flows to our pockets or not. That means using precious cash to pay "PERSONAL" income taxes that could otherwise be used to hire new employees, train existing employees, develop new products, purchase capital equipment, etc. We should only be taxed on income that does indeed flow to our pockets, which would free up cash resources to grow our businesses.
Nate Rubin (Chula Vista, CA) Vantage ID Applications, Inc.
I run a small real estate development, leasing and property management business that has already been negatively impacted by the current economic mess and the future looks grim. Because I am an S-Corp, all profits are taxed at the highest personal tax rate. Tax reform is a big priority for me. I don't mind so much the top tax rate going up so much as I do my lack of options for my business profits, most of which stay in the company to fund future investments. Under the current rules more will be taken away, leaving less to invest. The new health care situation is another hit on our company with the "Affordable" act making matters even more difficult. If Congress and the President don't get serious about long term solutions, and soon, I will be forced to lay people off in 2013. We cannot endure another (or more) recession. Anyone who doesn't believe that we are still in a recession (technical definitions aside) doesn't run a small business!
Randy Green (Salt Lake City, UT) Research Park Associates, Inc.
With the Affordable Care Act and now the impending tax changes, our small service firm will continue to lose employees to the largest companies in our area. Increasingly, it seems that only the largest employers (including government entities) can take advantage of economies of scale when seeking health care and in managing increasingly complex tax schedules. I appreciate the spirit of care and fairness that seems to motivate these changes, but the massive administrative burden to ensure these goals are met is driving the workforce away from small business.
Andrea Egger (Anchorage, AK) PangoMedia, Inc.
I met with my accountant today to discuss my quarterly tax contributions due by mid-Sept. During our meeting he said, "Unfortunately, I can see why other people try to cheat or leave this system...doing things the proper way, like you are, is a real financial hardship. Between state and federal taxes, and as a sole proprietorship, you may be paying 35%-50% in taxes after all is said and done since you don't have many deductions." (A Catch-22: I don't have many deductions because I try to keep expenses low.) It makes me sad to learn how much I have to pay in taxes because I had planned on using my small business earnings to help pay down my student loan debt (I just graduated with a master's degree) and to hire at least two more employees to expand the firm. All things considered, I love what I do, but is it worth it to be a small business owner at all? Many others seem to have similar concerns.
April Deibert (San Diego, CA) AK Global Strategic Communications
First of all I would like to thank you for asking our opinion. For some strange reason I have felt like this is one of the core areas that our President doesn’t understand and has not taken the time to comprehend. From our standpoint, we are finally beginning to thrive again after the recession. We currently employ 44 people in the technology space who enjoy a good living and have a great healthcare plan. Let me be clear, Obama’s tax plan will impact our hiring and new purchase process. The plan will take enough money out of our bank account to reduce our 2013 hiring by 2 people (recent college graduates), minimize raises by 2%, and reduce the amount we will spend on new equipment.
Jim Wanner (Liberty, SC) KeyMark
The government is totally out of touch with small business and a burden that most small business can not bear! Nothing positive will occur until there is a strong viable plan in place to balance the budget. secondly the tax code is so complicated the average individual can not start a business and pay the taxes correctly due the complexity of the code. Everything they get involved with becomes missed manager and now they want to take over healthcare? Let anyone know you are 14 trillion in debt and see if anyone will do business with you.
Todd Searles (La Fontaine , IN) Apex Automation
Recognizing the importance of entrepreneurs’ feedback in the process of shaping the very policies that will help determine their business sustainability and growth, Chairman Graves launched Small Biz Open Mic in September of 2011.