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Extensions of Remarks 18438 EXTENSIONS OF REMARKS July 9, 1992 EXTENSIONS OF REMARKS PAYROLL TAX DEPOSITS AND 20th and a hearing is scheduled for August paragraph {c)(1) of this section, A is subject SMALL BUSINESS: IRS SIM­ 3rd. I will be filing a more complete, formal to the Monthly rule for the entire first quar­ PLIFICATION SYSTEM MISSES statement by the due date and will also ask ter of 1993 regardless of the amounts accu­ THE MARK to appear at the hearing. mulated, unless the amounts trigger the My purpose in writing today, however, is $100,000 One-Day rule in paragraph (c)(3) of to express my immediate disappointment this section." HON. ANDY IRELAND with your agency's proposal. My initial re­ And please note that this is the agency's OF FLORIDA view of the recommended changes suggests idea of an example aimed at clarifying how they do not simplify the payroll tax deposit the proposal works. IN THE HOUSE OF REPRESENTATIVES system to any great advantage and do not As I suggested, these are only a few, initial Thursday, July 9, 1992 help as many small businesses as they observations about the proposal. As you Mr. IRELAND. Mr. Speaker, as our col­ should. probably gather, I'm not very enthusiastic Let me digress for a moment, first, to note about the scope or style of the changes, and leagues are no doubt aware, on May 18, the that I am flabbergasted that a proposal tout­ frankly, I'm not very optimistic about what Internal Revenue Service issued a proposed ed as helping small business would declare else might turn up under closer scrutiny. rule to help untangle its wholly unintelligible that the Regulatory Flexibility Act, the Ad­ Still, let me hasten to note that. if my payroll tax deposit system. In doing so, the ministrative Procedure Act, and a Regu­ quick interpretation of the changes is not agency claimed a great victory in the battle latory Impact Analysis do not apply. accurate, I hope you will not hesitate to cor­ against Government redtape. As to the latter, to suggest, as the IRS rect me. does, that the proposal does not constitute a If, however, my understanding is basically I rise today to inform-and warn-the on target, I hope your agency will use the House that these triumphant assertions greatly "major rule" when it affects hundreds of millions of payroll tax dollars truly defies public comments and the hearing to the ad­ overstate the case. reason: If this proposal is not a "major vantage of small enterprises, and will move My initial studies of the proposal reveal only rule", I really have to wonder what the IRS quickly to create a clear, simple, under­ a small victory in the making: A system based thinks a "major rule" is? standable payroll tax deposit system that on absolute chaos may be replaced by one Further, your agency's determination that will truly help small businesses help Amer­ notable for its mere complexity. the Regulatory Flexibility Act does not ica. Mr. Speaker, I applaud the IRS for its effort, apply, either, takes us back to the rather I have taken the liberty of enclosing an ar­ tiresome argument over the scope of the Act ticle that appeared in the Washington Post but I am discouraged and disappointed that ten years ago and which described in painful the opportunity for true reform, for the creation and whether the IRS is covered by it. Very simply, the Act covers regulations affecting detail the mind-boggling complexity of our of a system that is simple and fair, may be small businesses; your proposal very specifi­ payroll tax system. From my conversations lost among all the hyperbolic statements and cally affects small businesses; so it would with small businessmen and women through­ self-congratulation. logically follow that the Regulatory Flexi­ out the country, it seems clear that we have For this reason, I would like to insert in the bility Act applies to the agency's rec­ made little or no progress over the last dec­ CONGRESSIONAL RECORD my recent letter to ommendations. If you could explain why the ade. I hope we seize the opportunity to Commissioner Peterson which outlines my IRS doesn't follow that straightforward change the system the right way now before logic, I would appreciate it. another decade passes. concerns about the proposal. I hope ·our col­ Thank you for your time and consider­ leagues read it with their hometown busi­ As to the proposal itself, my crude calcula­ tions indicate businesses-and this is an out­ ation. nesses in mind. side figure-employing seven workers or less, Sincerely, At the same time, Mr. Speaker, I also en­ and this estimate applies only if everyone ANDY IRELAND. courage our colleagues to read the proposal makes $20,000 per year, including the busi­ itself as it appears in the May 18 Federal Reg­ ness owner. In real life, the proposed ceiling [From the Washington Post, Nov. 13, 1983] ister. If they agree with my assessment-that of $12,000 in quarterly payroll tax deposits 15 FORMS TO HIRE A DOMESTIC? the changes do not simplify the payroll tax de­ may grant relief only to the very smallest (By Spencer Rich) posit system and do not help as many small enterprises, probably just those employing God help you if you ever hire a domestic businesses as they shoul~then I urge them two to three workers. employee such as a housekeeper or maid for As such, the scope of the revisions is rather any length of time. You will be snowed under to write the Commissioner and ask for real re­ contracted, denying the monthly deposit op­ form. by a blizzard of federal and state paperwork. tion to as many as two million, perhaps Can't somebody unite all this stuff into a Mr. Speaker, small enterprises, the great job three million, small businesses that employ single form and make it easy for people to creators, producers, and innovators of our 10 or fewer workers. It seems to me that our obey the law? country, are suffocating under piles of Govern­ purpose here should be to help as many small In the State of New York, for example, ment redtape, from coast to coast, border to enterprises as possible, thus allowing them where I've had some recent experience help­ border. We can pipe some oxygen to them by to direct their time and capital into job cre­ ing an elderly aunt with her accounts, 12 fed­ helping the IRS develop a truly simple, work­ ation and production, rather than figuring eral or state forms must be sent in to dif­ able tax deposit system. I hope our colleagues out and filling out IRS forms. ferent agencies during the year if during the Finally, if it is only the very smallest en­ year you employ a nurse's aide or house­ will join in this campaign on behalf of Ameri­ terprises the IRS is seeking to help-however keeper for any time. ca's small businesses. misguided that may be-we should note that If a domestic workers works for you for a HOUSE OF REPRESENTATIVES, these businesses typically can't afford to few months, earns a certain amount, then COMMITTEE ON SMALL BUSINESS, hire accountants and tax attorneys. As such, quits and you hire another one, the number Washington, DC, July 8, 1992. the proposed revisions should be as simple of required filings jumps to 15, and it can rise Hon. SHIRLEY D. PETERSON, and understandable as humanly possible. higher if this happens several times a year­ Commissioner, Internal Revenue Service, Wash­ From my reading of the proposal, however, and this doesn't count the task of obtaining ington, DC. it seems to me that these small business initial employer ID numbers from the federal DEAR Ms. PETERSON: As you know, on May owners won't be able to understand the revi­ and state governments. 18th your agency announced that it was sim­ sions and requirements by themselves. In My aunt was ill and needed help around plifying its federal employment tax deposit fact, I'm not altogether sure I understand the house and with her medicines, so she em­ rules with the laudable goal of easing the such statements as this: "Because the em­ ployed a succession of women as domestic regulatory burden imposed on small busi­ ployment taxes accumulated by A during workers. nesses. each quarter in the base period do not exceed For several quarters her total outlays to As part of that announcement, the IRS $12,000, A is a monthly depositor pursuant to pay all the workers averaged about $2,400 a states that formal comments are due by July paragraph (b)(2) of this section. Pursuant to quarter. She was too ill and old to under- • This "bullet" symbol identifies statements or insertions which are not spoken by a Member of the Senate on the floor. Matter set in this typeface indicates words inserted or appended, rather than spoken, by a Member of the House on the floor. July 9, 1992 EXTENSIONS OF REMARKS 18439 stand the forms or to know what to do. Let­ The individual could send that amount with Ubya is now feeling the effects of recently­ ters from the Internal Revenue Service and the form, perhaps to the IRS as lead agency, imposed U.N. Security Council sanctions de­ New York Department of Labor piled up de­ which could send the forms and money elec­ signed to compel him to surrender two Libyan manding payment of taxes.
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