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Updated Tax Code Sought

House lawmakers want to simplify taxes for smaller businesses.

By Laura Palotie | 
 

House lawmakers are recommending a series of tax code reform provisions aimed at helping smaller businesses deal with the economic downturn.

In a report issued earlier this month, the House Committee on Small Business unveiled seven measures intended to ease the tax burden on small-business owners. These include a simplified home-office deductions system with an optional standardized deduction, shortened deprecation schedules for new equipment, and enhanced tax incentives for outside investments.

The updated code would also allow self-employed business owners to deduct the cost of health insurance premiums. Many entrepreneurs currently pay taxes twice on their premiums.

"When small businesses lose time and money because of outmoded rules, they can't bring new products and services to market," Rep. Nydia Velazquez (D-N.Y.), the committee's chairman, said in a statement. She said the current system undercuts innovation and competition.

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