An official from the American Institute of CPAs testified Wednesday before the Senate’s Small Business and Entrepreneurship Committee in favoring of lowering taxes for small businesses as much as corporations.

“Tax relief should not mean a rate reduction for C corporations only,” said AICPA Tax Executive Committee chair Annette Nellen in her written testimony. “Congress should continue to encourage, or at least not discourage, the formation of sole proprietorships and pass-through entities. If Congress decides to lower corporate income tax rates, small businesses should receive a lower tax rate as well.”

Small businesses would still need to distinguish between profits and owner compensation. “We should continue to use traditional definitions of ‘reasonable compensation’ for this purpose,” said Nellen. “Partnerships and sole proprietorships should be required to charge reasonable compensation. We should not treat partners and proprietors as ‘employees,’ but rather as owner-operators whose labor is subject to appropriate withholding taxes.”

Sen. James Inhofe, R-Okla., discussed the concept of tax simplification with Nellen. “I don’t know one CPA who is not in favor of tax simplification,” he said.

Sen. Heidi Heitkamp, D-N.D., wondered what the line was between small businesses and large businesses, and how Congress could distinguish between the two in making tax policy. She pointed to the complexity of the tax preparation process for many small businesses. “Without tax preparation software it would be really hard for a small business or a sole proprietor to file their tax returns,” she would

“Without TurboTax and the other tax prep software, we would have a taxpayer revolt,” agreed Brian Reardon, president of the S Corp Association, a lobbying group.

In his prepared testimony, Reardon argued that Congress needs to enact reforms that fix the tax code for both C and S corporations. “The C corporation tax rate may be among the highest in the world, but the tax rate paid by S corporations is even higher,” he said. “Moreover, pass-through businesses have a bigger economic footprint than C corporations. They employ more people and they contribute more to national income. So any reform needs to be permanent, comprehensive, and treat pass-through businesses as equal partners.”

Sen. Tammy Duckworth, D-Ill., noted that even large companies such as the Trump Organization operate many pass-through businesses. “It’s become easier for larger businesses to set themselves as pass-through businesses,” said Mark Mazur, director of the Urban-Brookings Tax Policy Center.

Nellen asked the lawmakers not to impose any new limits on the use of the cash method of accounting. “The cash method is simpler in application, has fewer compliance costs, and does not require taxpayers to pay tax before receiving their income, which is why entrepreneurs often choose this method,” she said in her prepared testimony. “Forcing more businesses to use the accrual method unnecessarily discourages business growth, increases compliance costs and imposes financial hardship on cash-strapped businesses.”

Nellen also stressed the importance of the interest expense deduction to owner-operators of small businesses. “Owners borrow to fund operations, working capital needs, equipment acquisition and even to build credit for future loans,” she said. “We should not take away or limit this critical deduction for many small businesses who, with little or no access to equity capital, are often forced to rely on debt financing.”

Nellen recommended several other business tax reforms in her written testimony, including increasing the startup business deduction, repealing the alternative minimum tax for individuals and corporations, and simplifying the tax rules for such things as qualified retirement plans. “Small business owners must deal with many business decisions and concerns,” she said. “They have expertise in their business products and services, but rarely are they experts in areas such as capitalization, retirement plan rules and alternative tax regimes.”

Nellen also urged the senators to create a new practitioner services unit at the IRS to provide an online tax professional account with access to clients’ information as part of an IRS modernization effort. “Enhancing the relationship between the IRS and practitioners benefits both the IRS and the millions of taxpayers, including small businesses, served by the practitioner community,” she said.

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