Top 10 regulations that give small business owners the worst headaches

The Code of Federal Regulations has grown to 175,000 pages, so it’s no wonder that small businesses cite regulatory burdens as one of their biggest challenges.

Some regulations are more burdensome than others, however. While many regulations affect only certain industries, some regulatory requirements apply to virtually every business. Here are 10 regulations that are particularly vexing for small businesses.

1. The federal tax code

There’s more to taxes than paying them. For small businesses, navigating the complexities of the federal tax code is more of a burden than the money they lose to the government.

That’s according to a survey of small business owners conducted last year by the National Small Business Association. Nearly 60 percent said administrative burdens were the biggest challenge to their business posed by federal taxes.

It’s not just income taxes; payroll taxes are a hassle as well. That’s why most businesses with more than five employees use an external payroll company, NSBA found.

One-third of small businesses report they spend over 80 hours per year on federal taxes, and nearly half pay at least $5,000 a year to accountants or other tax practitioners.

That’s why there’s strong support among small businesses for simplifying the tax code.

2. The Affordable Care Act

Obamacare not only has changed the health insurance market, it also has added a host of data collection and reporting requirements for businesses.

“Employers need to devote significant time and energy to maintain compliance with the law,” said Julie Stich, director of research at the International Foundation of Employee Benefit Plans. “The extensive amounts of data that employers are required to collect can take hours and even require complex IT infrastructures. The process has meant a cost increase for many, especially smaller organizations.”

For example, businesses with 50 or more employees must file 1095-C forms with the Internal Revenue Services for every worker, showing that they have health insurance coverage meeting the ACA’s minimum essential coverage requirements.

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