SB/SE Burden Reduction Issue Committee Meeting Minutes
October 18, 2007
12:30 P.M. ET
Teleconference

Program Owner

• Jones, Allen - Washington, DC

Designated Federal Official

• Knispel, Marisa - Brooklyn, NY - Analyst

Committee Members Present

• Behnkendorf, Larry - Waterford, MI - Member
• Bensen, Milissa - Hermiston, OR - Member
• Bly, Bill - Wayne, PA - Chair
• Cordeiro, Daryll - Mobile, AL - Member
• Davidson, Charles - Redding, CA - Member
• Edwards, Byron - Roswell, GA - Member
• Gursey, Gregory - Anchorage, AK - Member
• Jason, Julie - Greenwich, CT - Member
• Kasturi, Srinivasan - West Orange, NJ - Member
• Maisch, Steven - Arlington, WA - Member
• Margulies, Howard - North Easton, MA - Member
• O’Donnell, Marie - Wilmette, IL - Member
• Richardson, Lovella - Knoxville, TN - Member
• Shah, Rajiv - Scottsdale, AZ - Member

Committee Members Absent

• Barry, Shaun - Franklin Square, NY - Member
• Guthmann, Howard - St. Paul, MN - Vice Chair
• Havey, Dorothy - Lincolnville, ME - Member

TAP Staff

• Odom, Meredith - Brooklyn, NY - Note Taker

Other Attendees

• Welsh, Kathy - Downers Grove, IL - Analysts, OTBR

Welcome
Bly welcomed the committee, members and staff.

Roll Call
Quorum has been met

Review Agenda
No changes were made.

Joint Committee Report
Bly reported on the Joint Committee Meeting and indicated that a formalized mentoring process was instituted for new TAP members to help them get started with the organization. Electing a new TAP Chair and Vice Chair will also be done prior to the Annual Meeting via email. The deadline for all interested parties is November 16th. Bly encouraged all members of this Issue Committee to run for either TAP Chair or for any committee chair.

Update on Office in the Home Project
Welsh updated the Committee on the Office in the Home Project in which the members were involved. She recapped explaining that this 2006 Project was to examine the office in home the home deduction and the forms involved and was done as part of the Tax Gap legislative package from the Treasury Department. 

The Office of the Taxpayer Burden Reduction (OTBR) advocates using a standard rate times the square footage to calculate the deduction and also to exclude depreciation until the time of sale. This recommendation would avoid the detailed recordkeeping and mathematics that are currently involved in calculating the deduction. The Treasury has asked OTBR to consider the recommendation as a regulation change. The target date for the completion of the Project is in tax year 2008 and will be addressed as a legislative proposal.

Discussion with Program Owner
Schedule C Burden Reduction Project
Jones thanked the members for their input and their interest on the S-Corporation Project. Jones has assumed the responsibility for this Project and indicated that the revenue procedure was approved by Treasury.

Jones also indicated that the OTBR was continuing to work on the Burden Reduction Project and he would keep the Committee updated. He indicated that the major items of burden on the Schedule C were associated with the cost of goods sold, the business use of the home, depreciation, expenses of travel, meals and entertainment and bad debts. He also indicated that the major issues associated with burden are: recordkeeping, IRC Section 183, understanding the profit/loss statement and complexity of the tax law and the procedures. More research is needed to identify the burden line items and issues for the specific market segments and the causes of the burden. He indicated that the segments are identified by the cost of goods sold.  Jones informed the members that OTBR is currently working with other IRS organizations such as the SBSE Stakeholder Liaison to conduct focus interviews with external groups. Kasturi suggested reaching out to tax preparers who commonly prepare the Schedule C and also to use the entire TAP as a nationwide focus group. Jones agreed that TAP would be a good resource as well as other IRS advisory committees. 

To conclude the session, Jones informed the Committee that OTBR is also working on projects related to the amended Form 941, Form 94X and the Form 944.

TAP’s Recent Joint Committee Meeting and Upcoming Annual Meeting
Bly would like to suggest for those members continuing their term with the TAP that the SBSE Issue Committee should meet at least once a month, not every other month as it was done this year. He indicated that this Committee will meet on December 13th at the Annual Meeting and we will meet for a group dinner on the 12th. To conclude, he encouraged again all the committee members to run as a committee chair.

Public Input
None