March 18, 1997
Washington, D.C. -- The National Association for the Self-Employed lauded the Home-Based Business Fairness Act -- introduced today in the Senate by Senate Small Business Committee Chairman Kit Bond, R-Mo., and Senators Don Nickles, R-Okla., Olympia Snowe, R-Maine, John Warner, R-Va., and Frank Murkowski, R-Ala. -- as legislation that will have "enormous impact in the lives of small-business owners." The bill, which is strongly supported by the NASE, addresses three of the small business community's top priorities: the home office deduction, health insurance deduction for the self-employed, and independent contractor status.
Home Office Deduction -- The legislation modernizes the deduction by qualifying home offices which are 1) the location where taxpayers regularly perform essential administrative or managerial activities; and 2) is the only location available to perform such activities. The current test requires that home-based business owners meet with clients and generate income within the office to take the deduction.
Health Insurance for the Self-Employed -- The legislation would allow self-employed individuals to fully deduct the cost of health insurance premiums for themselves, their spouses and children, starting with tax year 1997. The current deduction is 40 percent, scheduled to reach 80 percent by 2006.
Independent Contractor Status -- The legislation sets a new, streamlined definition of independent contractors to supersede the current, confusing 20-factor test used by the IRS.
"The Home-Based Business Fairness Act will give hard-working individuals a bit of breathing room," said NASE President Bennie L. Thayer. "Its passage is especially crucial for NASE's members -- the smallest of small business. Many of them work from the home, often while looking after young children or other family members at the same time. Eighty-five percent of our members have fewer than four employees. They are time-stressed and budget-pressed. This legislation can give them back a little of both.
"Small business owners and entrepreneurs are the embodiment of this nation's tradition of individualism and can-do spirit," Thayer continued. "They are our innovators and our inventors. They are our thinkers and our doers. And they add much more to this country than talent and creativity. Small businesses are the engine that drives our nation's economy. They generate jobs, perform and utilize services, and foster innovations. The Home-Based Business Fairness Act keeps that engine running. It's legislation that helps not only the small-business owner, but the entire country.
"The NASE salutes Chairman Bond and Senators Nickles, Snowe, Warner and Murkowski," Thayer concluded. "They are working to bring the American Dream closer to millions -- the dream of being your own boss, working from home and staying close to your family. We thank you and will work with you to make this legislation a reality."
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