SB/SE Burden Reduction Issue Committee Meeting Minutes
August 16, 2007
12:30 P.M. ET

Program Owner

• Jones, Allen - Washington, DC

Designated Federal Official

• Goldberg, Gloria S. - Brooklyn, NY - Acting Manager

Committee Members Present

• Barry, Shaun - Franklin Square, NY - Member
• Behnkendorf, Larry - Waterford, MI - Member
• Bensen, Milissa - Hermiston, OR - Member
• Bly, Bill - Wayne, PA - Chair
• Edwards, James - Roswell, GA - Member
• Guthmann, Howard - St. Paul, MN - Vice Chair
• Gursey, Gregory - Anchorage, AK - Member
• Kasturi, Srinivasan - West Orange, NJ - Member
• Maisch, Steven - Arlington, WA - Member
• Richardson, Lovella - Knoxville, TN - Member
• Shah, Rajiv - Scottsdale, AZ - Member

Committee Members Absent

• Cordeiro, Daryll - Mobile, AL - Member
• Davidson, Charles - Redding, CA - Member
• Havey, Dorothy - Lincolnville, ME - Member
• Jason, Julie - Greenwich, CT - Member
• Margulies, Howard - North Easton, MA - Member
• O’Donnell, Marie - Wilmette, IL - Member

TAP Staff

• Knispel, Marisa - Brooklyn, NY - Analyst
• Odom, Meredith - Brooklyn, NY - Note Taker

Welcome
Bly welcomed the members and staff.  He spoke about the time it takes the IRS to respond to TAP committees on their recommendations. Guthmann stated that he is interested on the IRS’ response to our Committee’s Office-in-Home proposal and also expressed his concern about the lack of issues brought to the Committee by the Office of Taxpayer Burden Reduction (OTBR) this year. Kasturi added that the OTBR has been responsible in promptly responding to proposals this Committee made last year with the exception of the Office-in-Home and the Subchapter S. Knispel reminded the members that Allen Jones did provide an update on the latter issue (Subchapter S) during our meeting in San Diego and he also promised to invite OTBR Analyst Kathy Welsh to our next full-committee meeting to provide us with an update on the recommendations we made to the Office-in-Home issue.  

Roll Call
Quorum Met

Review Agenda
After everyone agreed with the agenda for today’s meeting, Bly introduced and welcomed Gloria Goldberg who is the Acting TAP Manager in the Brooklyn Office and the Acting DFO for this Committee as well. Goldberg introduced herself telling us about her work with the TAS and her background with the Citizens Advocacy Panel (CAP), the precursor to the TAP.

Program Owner- Schedule C Burden Reduction Project
Jones indicated that Knispel had forwarded to them a copy of the Preliminary Business Case for the Small Business, Schedule C Project and hoped that all members had a chance to read it.  He had submitted the Business Case to OTBR Director Jody Patterson who has shared this document with key executives and other internal IRS stakeholders.  Prior to sharing it with others, the OTBR met to discuss their role on the Project. They discussed issues such as the possibility of eliminating sole proprietors that file Schedule C with assets under $100,000.  They also discussed ways to segment the Schedule C filers by industry or by considering specific line items on this Schedule.  Jones is awaiting some statistical information from the IRS research department that is needed to continue the Project and that he hopes to share with the sub-committee by the end of this month. 

Bly indicated that the Business Case does not clarify how much of the under-reporting or the errors made by Schedule C filers are due to their lack of understanding of the tax law as opposed to intentional cheating.  Jones, however, feels that a lot of these errors or the problem with under-reporting is not due to fraud or cheating but to burden in filing the Schedule. He added that if research proves that intentional cheating is in fact the case, the Project has no value.  He also said that research shows that a significant amount of the errors are in favor or the government because the taxpayers have overpaid their tax.  Behnkendorf disagreed. He feels that a lot of people fear to report certain items on the Schedule C that might be considered questionable and thus, either under-report, over-report or become non-filers. Jones replied by saying that he hopes the situation is one of burden reduction which OTBR can help mitigate as opposed to one of fraud where the Project will be referred to the IRS enforcement with the aim to improve compliance.    

In closing, Bly invited all Committee members to participate in the Schedule C sub-committee meeting scheduled for September 20th. At that time, we will review the pending research findings that Allen will provide us with and continue with the Schedule C Project.

Bly also invited the returning Committee Members to consider chairing this Committee or one of its sub-committees.

Public Input
None

Next Meeting
Subcommittee – September 20, 2007 – 12:30AM ET