What Are Small Businesses Saying About Their Tax Challenges?

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Washington, Apr 8 | comments

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Tomorrow, the House Small Business Committee will conduct a hearing titled, The Biggest Tax Problems for Small Businesses. The hearing will examine some common tax challenges for small businesses. In addition, a new National Small Business Association survey on tax compliance will be released in conjunction with the testimony of one of its members, Tim Reynolds, President, Tribute, Inc., Hudson, OH.

Here is what small business owners have told the Committee through our interactive website “Small Biz Open Mic” about the impact taxes have had on their companies.



Tax reform for businesses and individuals is a critical issue for us. We are owners of a pass-through Subchapter S professional service business. With the top personal rates potentially increasing even more than they are now, our business will suffer. We already have frozen any hiring. The tax and accounting complexity and cost of a C corporation, make the S structure the right one for the business. When the President attacks and categorizes individuals who show a gross income over $250,000 as "rich" he fails to acknowledge that a significant portion of "individuals" actually are pass-through S corporations, partnerships and sole proprietors owning small businesses. To allow U.S. businesses small and large to regain competitive standing with other nations, both the individual and corporate the tax rates need to be lowered and the tax code simplified. 

Sara O'Neil-Manion (Bethesda, MD), October 22, 2013

We are struggling to survive and, with mounting taxes and charges, are seriously considering closing up. That would put more people out of work. The end result is that the Government is hurting the very people they think that they are helping.

H. Shomer (Brooklyn, NY), February 25, 2014

When you're a startup on a tight budget and struggling to survive, that's a big hitter. Too many laws and regulations for a small business to manage, particularly the insane federal tax code that causes a small business to spend an inordinate amount of time and money on lawyers and CPAs just to comply with the tax code and prepare annual tax returns -- whether the business is making any money or not. Totally agree with some of the other comments: reduce the federal red tape and get the government out of the way.

Ron Gates (Austin, TX), Spectral Inc., February 25, 2014

We are being taxed to death! I feel it's a bit unfair that we pay taxes on every penny deposited into the account when 90% of it is for equipment, supplies and employee salaries. It's almost impossible for a small business owner to stay afloat now days. It's almost not worth owning a small business. We'd like to hire more employees but are barely able to meet salaries now. Please stop taxing us to death and give us a break for being a small business. 

Cindy Myers (Bates City, MO), T&C Fire and Security Systems, February 25, 2014

Obamacare is a major drag on our growth and available working capital. Growing taxes are sucking our coffers dry. Regulation and paperwork are burying us. Not sure how much longer we can sustain the headwinds of government. 

Randy Mysliviec (Cincinnati, OH), January 14, 2014

We have chosen to continue offering insurance. But the new ACA will place an undue burden on us as the 3 new "taxes", PCOR ($1 per life), Reinsurance ($65 per life), and HITS (a share of $8 billion dollars in the first year), are levied against us by the insurance carriers. As a small employer, we are trying to do what is right for our employees by offering benefits. 

We cannot continue to absorb the increased costs and therefore, will be forced to pass these additional taxes through to our employees increasing the amount they must pay for insurance. What happened to "there will be no no new taxes and no additional cost" to implementing the ACA?

Juanita Melton (Floyds Knobs, IN), October 23, 2013

Companies spend an inordinate amount of money managing their taxes rather than investing in R&D. Maybe we should switch from supporting innovation to being tax accountants. So my advice: Simplify the tax code and craft a budget that removes spending on non-productive activities and provides incentives to invest in innovation, new product development and value creation.

Sheldon Broedel (Baltimore, MD), AthenaES, October 22, 2013

Unfortunately almost everything that government does subtracts from our ability to create more jobs. The ridiculous amount of regulations, the ever increasing tax burdens, the absolute catastrophe that is the obamacare plan, all of this hinders our ability to expand business and to create jobs. Back-off leave us alone, lower the taxes, the free market will insure that employees are not only paid well but also treated well.

Richard Anderson (Auburn, CA), TGH Aviation, October 22, 2013

We need a simple, rational, and neutral federal income tax structure with no social or economic tinkering available to either side of the political spectrum. No more tax breaks, loopholes, incentives, rebates, or gimmicks. The entire federal tax code should be a maximum of two pages - double-spaced.

Mike Hagerty (Bellaire, TX), Cuna Supply LLC, April 4, 2014

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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.


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