IRS to cut biz burden
- By Judi Hasson
- May 22, 2000
On any given day anywhere in America, businesses from Wall Street to Main
Street are chained to the federal government.
Businesses have data to store, forms to fill out, identification numbers
to be placed in neat, little boxes, and money to be handed over for taxes,
taxes and more taxes.
And at least four times a year, every business — large and small — must
file tax returns, a process that takes hours, costs money and gives little
in return except for employing accountants, clerks, bookkeepers and messengers.
Now, as it struggles to turn itself into a paperless agency, the Internal
Revenue Service is coming up with new ways to help the estimated 25 million
businesses nationwide file online and save $16 billion to $18 billion a
year — as much as $1,000 per employee for some businesses.
The program is called the Simplified Tax and Wage Reporting System (STAWRS),
a partnership to reduce employers' tax and wage reporting burden.
On the drawing board for the past four years, the program took a giant
step forward this month when the STAWRS partnership selected states and
commercial partners to develop software that would enable businesses to
file electronically to a single recipient.
"This is a new way of thinking. We are looking at it from the employer's
perspective," said Midori Morgan-Gaide, an IRS executive in charge of the
Morgan-Gaide hopes to have a pilot project up and running next year
with test software. And like the IRS' target date to have individual taxpayers
file online, the target is to have 80 percent of all businesses filing online
But the idea is gaining steam already. With a mandate from Congress
to provide citizens the option of submitting government forms electronically
by October 2003, the IRS started a pilot proj- ect testing online W-2 tax
form filing. Also, several states, including New York, Iowa and Montana,
have worked to give local businesses the ability to file online to a single
location in the states' systems.
Now, with input from several agencies that deal regularly with business — the Treasury Department, the IRS, the Labor Department, the Social Security
Administration, the Office of Management and Budget and the Small Business
Administration — the government hopes to speed up the project.
Much like the employee tax filing software that has been on the market
for the past two years, employers' software would be sold commercially.
Business owners would load the software onto their computers and keep records
electronically. Millions of dollars in business is at stake for companies
that successfully design tax filing software.
"It's an ambitious program.... Larger employers are ready to do it much
more quickly, and when it is finished it really will benefit small business,"
said Olga Grkavac, executive vice president for the Information Technology
Association of America's Enterprise Solutions Division.
Even those who are usually critical of the way the IRS does business
see STAWRS as a way to break the chains.
"Short of Congress doing its job by simplifying the law itself, this
is one of the few things the IRS can do to simplify government. A one-stop
shop would certainly cause less headaches for the small-business owner,
provided very big steps are taken to ensure privacy," said National Taxpayers
Union representative Pete Sepp.
Nevertheless, Morgan-Gaide suggests there are still problems with electronic
signatures or how to provide secure codes for filers. And some people will
always want to conduct business the old-fashioned way, she said.
"We've tested the concept. We know it works...but we know paper will
always be there."