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House Ways and Means Committee Chairman Dave Camp released his proposed tax plan in early March. The document titled "The Tax Reform Act of 2014" included many provisions to change both business and personal tax reporting. Many of the provisions are aimed at simplifying the tax code and making things easier for US small businesses and American taxpayers.

Included in the many business proposals is PEO specific language similar to the earlier proposed tax bill, The Small Business Efficiency Act. The proposal discusses how a PEO would be treated as the employer of record and held responsible for the withholding and remittance of payroll taxes on behalf of their clients. Certified PEOs would be required to meet certain conditions (covering at least 85% of a client's workforce, annual independent financial statement audits, quarterly payroll tax compliance audits and posting of a bond). These provisions would give certainty to the PEO industry and provide assurances to new companies looking to outsource their employee administration.

Being an election year for many members of Congress, it is unlikely that a major tax proposal would be passed and enacted. However, many of the provisions included in the overall proposal have already sparked much debate within Congress and in the public. Some aspects of this tax proposal may end up becoming smaller bills that are more favorable to the overall populous and have a better chance of enactment in the new Congress.

For more details on the Camp tax proposal, please contact a member of the firm's National PEO Practice or your local UHY LLP professional.