Newspaper article Pittsburgh Post-Gazette (Pittsburgh, PA)

Taxes Weigh on Startups Small Business Owners Find outside Help for Returns

Newspaper article Pittsburgh Post-Gazette (Pittsburgh, PA)

Taxes Weigh on Startups Small Business Owners Find outside Help for Returns

Article excerpt

To tell the tale of taxes and misery, Tim Tobitsch describes an evening roughly eight years ago at the Brillobox bar in Lawrenceville. He had complained to Megan Lindsey, his co-owner at a Downtown hot dog shop, about the trouble he was having completing the company's federal tax return.

Ms. Lindsey offered to help him, but after several hours at the bar, watching numbers swim in front of her, she became despondent, instead doodling a large heart on the tax return with tears spilling out of it.

In most of the years since, Mr. Tobitsch's tax pursuits have been on his own. For reasons part philosophical, part practical, he was determined to be one of a small fraction of business owners who do their taxes without an accountant.

"It was not something I ever wanted to do," he said, sitting at a table at his restaurant Franktuary's location in Lawrenceville. "But you just don't have the capital to pay everyone to do everything you want."

A report released Thursday by the National Small Business Association found that 86 percent of small business owners surveyed hire a tax practitioner or accountant. The group found that 9 percent used computerized tax software or had an employee do the company taxes, leaving a tiny percentage who do the taxes themselves.

"The overwhelming majority are outsourcing," said Molly Day, spokeswoman for the National Small Business Association. "What we're hearing from our members is that it's wildly complex."

In Franktuary's first years, the owners simply couldn't afford $300 for an accountant, said Mr. Tobitsch. So he decided to figure it out himself.

A table at the Franktuary restaurant in Lawrenceville ? the business expanded from its first location in a Downtown church basement to also include the full-service Lawrenceville restaurant and a food truck ? held folders brimming with receipts, notes, letters and tax forms as Mr. Tobitsch worked.

He still uses a chart that he developed labeled "TAXES ARE DUE!" with forms such as WT-1, City NP-5 and EM-1 scattered through the calendar. Sales taxes are due every month, with some months requiring much more. The month of January, for example, requires nine forms to be submitted in addition to sales taxes.

He laughs describing some of the more byzantine regulations and procedures ? including his nemesis, the city's local services tax form.

The form specifies that information on each employee must be submitted through either a CD or diskette. "Who uses the term ?diskette,' anyway?" he said. "Saying you have to have a floppy disk is just adding insult to injury."

There is an exception for businesses with fewer than 20 employees, which included Franktuary before the Lawrenceville location opened.

Under the exception, he could send in his Excel spreadsheet on a city-provided template, with a button on the template that converted it into an ASCII file. …

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