11/07/2001
The Seventh Circuit Court of Appeals handed the NFIB Legal Foundation its first courtroom victory yesterday in deciding a tax case in favor of trucking company U.S. Freightways Corporation. Last year, the Legal Foundation filed a brief in support of overturning a U.S. Tax Court decision that would force small businesses to run through a confusing maze of tax calculations, as opposed to simply deducting certain annual expenses.
The NFIB Legal Foundation joined the American Trucking Association, Inc., in filing a brief in the appeal of U.S. Freightways, Inc., v. Commissioner of Internal Revenue. Specifically, the case focused on whether companies can deduct costs such as annual permits, licensing fees and insurance premiums. The IRS argued that businesses can not simply deduct those costs, insisting they take the more complex and costly route of capitalization and depreciation.
"NFIB scored a huge victory this week on behalf of small businesses everywhere," said NFIB Legal Foundation Executive Director Tom Sullivan. "Right now, small businesses are struggling to survive; the last thing they need is for the IRS to deny the long-standing practice of deducting annual expenses."
NFIB represents more than 7,000 small trucking businesses across America, but Sullivan points out that the Court of Appeals' decision is a victory for employers far beyond the trucking industry, large and small. "Employers live in fear of being second guessed by an IRS audit. They can now breath a sigh of relief since the Seventh Circuit affirmed the validity of deducting annual permit and license fees and insurance premiums."
NFIB has a long history of aggressively pushing Congress and the IRS to lighten the tax burden that can overwhelm small employers. Bringing the tax simplification battle to the courts is an example of why NFIB established the Legal Foundation just over a year ago. "Small businesses deserve effective advocacy in every branch of government," said Senior Vice President for Public Policy Dan Danner. "This ruling is the first of what will be a long string of victories and proof of how important it is to bring the small-business agenda to the courts, where so many decisions that affect employers are made."
CONTACT: Michelle Dimarob, (202) 554-9000
