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November 14, 2007

AICPA turns spotlight on small business community

AICPA turns spotlight on small business community

The American Institute of Certified Public Accountants (AICPA) has formed a strategic alliance with the US Small Business Administration (SBA) in a bid to help small companies in the US work better with CPAs. The world’s largest institute has also endorsed legislation to cut the tax burden faced by small businesses.

The agreement will allow the SBA to market its services to CPA firms. It is hoped that this will help the business lobby group expand its member base and provide small businesses with greater access to SBA resources. AICPA president and chief executive Barry Melancon said the alliance promotes resource sharing between the members of both bodies. CPAs will gain access to SBA materials such as financing start-ups, expansions and disaster recovery.   SBA nominee Steve Preston emphasised the importance of forming the alliance with the accountancy body. “To have a national partnership with a group like the AICPA is incredibly important because when a small business owner is looking for answers, when they are looking for someone to trust, they are really in your hands as CPAs,” he said. 

The new alliance is a sign of the growing focus of the AICPA on the small business community. This month, the AICPA endorsed legislation to create a national standard for the state withholding of non-resident income tax. It hopes the standard will slash burdensome red tape that surrounds the tax regime.

“We need a simple and uniform system governing how states apply taxes to non-residents doing business in their states,” AICPA vice-president of small firm interests James Metzler said. “Record-keeping can be voluminous under the current regulatory scheme.”

The tax regime is viewed as unfair and burdensome on many small businesses and CPAs. At present, 41 states impose a personal income tax on wages and partnership income. However, most of these states have different tax requirements for withholding income tax of non-residents, which is a burden for CPAs and small businesses that conduct cross-state business. The AICPA’s statement was submitted to the House Judiciary Subcommittee on Commercial and Administrative Law.

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