There's an article posted this week on Small Business Review that you should take a look at. The U.S. Treasury Department has proposed sixteen items as part of its 2008 budget. Seven of them will increase reporting requirements for business. The object is to raise revenues but the resulting paperwork could be a nightmare for small operations.
For example, businesses are not currently required to file a form 1099 for payments to corporations. That would change under the new rules. It's said that it could double or triple your paperwork requirements. Another controversial proposal would require verification of Taxpayer ID Numbers of all contractors before payment can be made.
Another rule that could impact you is one that would require credit card companies to report your credit card sales to the IRS. On the surface that might not seem terrible, but considering the time lag between the sale and the time payment is received, transactions that span the end of the year could make it appear that something is wrong, triggering unnecessary audits. Also, the measure would be very costly for the credit card companies, costs that will most likely be passed along to their customers. That would be you.
Congressional approval of the Treasury budget is far from a sure thing. According to the St. Louis Post Dispatch, the current IRS regulations take up a whopping 67,000 + pages (That's not a typo. The IRS regs really are more than sixty seven thousand pages long.) additional requirements may have trouble getting passed. On the other hand, the federal deficit is huge and Congress is going to be looking for ways to increase revenues.
We'll keep an eye on this for you and let you know what develops.
Comments