Small Business Paperwork Reduction and Penalty Equalization Amendments Act

Small Business Paperwork Reduction and Penalty Equalization Amendments Act - Amends the Internal Revenue Code to relieve an employer of his obligation to furnish his employees whose employment is terminated before the close of the calendar year with a written statement of their wages and withholding, unless such employees request, in writing, a statement within 30 days from the date of their termination. Requires the employer to furnish such information within 30 days of receipt of an employee's request. Reduces the penalty imposed upon an employer for failure to provide such information.

Reduces penalties imposed upon a tax-exempt organization, a trust, or the manager of a tax-exempt organization for failure to file required tax returns. Reduces penalties imposed upon a private foundation for its failure to file required annual reports.

Relieves income tax preparers from liability for an underpayment of estimated tax by an individual or corporation.

Defines "negligent or intentional disregard of rules and regulations" and "willful neglect" for purposes of determining the liability of an income tax preparer for an understatement of taxpayer liability.