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"Guilty before proven innocent," is the motto of the Internal Revenue Service, Abraham Schneier, testifying on behalf of the National Federation of Independent Business, told the National Commission to Restructure the IRS at a hearing in Washington.

"Small-business owners are at the mercy of the IRS when the agency accuses them of wrongdoing," Schneier said. "The IRS comes into a business and conducts an audit that could take a lot of time and money. Oftentimes, the business owner is found innocent, but not before being treated like a criminal. In the absence of a pattern of abuse, the burden of proof should be on the IRS, not the taxpayer."

Schneier, a partner in the firm of McKevitt & Schneier, said that until America's tax system is reformed altogether, there are immediate changes that must be made: The tax system should educate taxpayers before enforcing the law; allow small-business owners to correct any mistakes before punishing them; and assist taxpayers before they are penalized.

"The single most important reform for small-business owners is for the IRS to allow greater use of alternate dispute resolutions," Schneier said. "In many cases, the cost of retaining a tax attorney or accountant exceeds the cost of penalty or underpayment of taxes they are being charged."

Schneier also emphasized the importance of simplifying a tax code that contains a single sentence that is longer than the Gettysburg address.

"The average small-business owner has a tough time complying with such a complex tax code," Schneier said. "Many business owners want to understand what the tax system requires of them even if they are capable of hiring tax professionals." *

The CPA Journal is broadly recognized as an outstanding, technical-refereed publication aimed at public practitioners, management, educators, and other accounting professionals. It is edited by CPAs for CPAs. Our goal is to provide CPAs and other accounting professionals with the information and news to enable them to be successful accountants, managers, and executives in today's practice environments.

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