Don't let this happen to you!
The local university has a course called 'Federal Income Tax & Business Decisions'. Understanding the tax implications of business decisions is imperative. The necessity of devoting an entire course to the topic is an indication of the complexity of the United States tax code. Don't let this level of complexity ruin your business.
Few people, myself included, like the tax system. There are two basic reasons, the amount of the tax and the complexity. I am concerned about the complexity. The amount is a different discussion. That debate is about the purpose of society, what services should be provided at the national level, what should be provided at the state level and what is the responsibility of individual citizens. Once you have answered these questions, you can determine how much money is needed to provide these services. If you want more government services, you need to pay more taxes. Once the problem is clearly stated solutions are easier to find.
The reason the complexity irritates me is the cost of compliance. Every year millions of dollars are paid to professional tax preparers because the forms are too intricate for the average citizen to complete. Businesses spend countless hours reevaluating their financial strategies every time the tax laws change. These expenditures of time and money are a drag on society with no long-term benefits to society.
The reason the tax system has become complex is it is serving two very different purposes. The primary purpose of taxes is to raise money for the operation of the government, but over the years taxes have also been used for social engineering. Taxes are added to the price of cigarettes to reduce cigarette consumption. Interest on a home mortgage is deductible to encourage home ownership. Subsidies are paid to farmers to keep their cows from producing too much milk. These might be valid goals but once you start down this path you can't stop making exceptions. Should the mortgage interest deduction be unlimited or just for homes under one million dollars? What about a farm worth over a million but has only a small house?
Any system gets complicated because of the exceptions to the basic purpose of the system. Each exception or accommodation usually has a valid reason but a thousand exceptions make the entire system unwieldy. In business more and more resources go to the exceptions and less to the basics. Most of the phone calls to a product support help-desk concern the exceptions rather than the basic product features.
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