Most independent business owners do not understand their tax returns

A February survey of 1,300 independent business owners revealed that 55 percent don’t understand all aspects of their tax returns. Newtek Business Services conducted the research.

Additionally, 57 percent  of respondents said they would prefer to pay the same tax amount and would be willing to receive the same or less government services, instead of paying a greater tax and receiving more government services.

By a margin of 48 percent to 27 percent (with 25 percent indifferent), the surveyed business owners said they would not prefer a flat tax rate, even if it would not affect their payment in 2012.

Barry Sloane, president and CEO of Newtek, commented, "We greatly appreciate the candor of our surveyed independent business owners who, in the majority, admit they do not fully understand all aspects of their tax return that they sign off on. Taxes for small businesses are complicated to compute, a necessary evil and unfortunately are not completely understood by the independent business owner community.”

Sloane added, “It is clear from the results of our poll that the majority of business owners, despite wanting tax simplification, would prefer not to have a flat tax and give up all their deductions. The fear of the unknown, which is what their effective rate would be versus tax simplification, is not a tradeoff that they are prepared to make at this point in time. It was also interesting to note that business owners clearly do not believe they are getting a good return on their tax dollars, as the majority prefers to have the same tax contribution for fewer services than a greater tax contribution for greater potential government spending.” [The business owners] surveyed believe that the government inefficiently uses tax dollars."

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