News & Resources
New Law Repeals the Expanded 1099 Filing Requirements
Small Business Has Been Hoping for this Repeal
April 18, 2011
A law signed by President Obama on April 14, 2011 repeals the expanded Form 1099 reporting requirements that were imposed on businesses as part of last year's Patient Protection and Affordable Care Act (part of the health care reform legislation) and the Small Business Jobs Act. Those provisions would have required all businesses to issue a Form 1099 to any person or business to which they paid $600 or more during the year.
The health care legislation passed in March 2010 expanded Form 1099 reporting requirements to include all payments totaling $600 or more in a calendar year to a single payee, including corporations. The idea was to increase tax revenue to help pay for health care reform.
A provision in the Small Business Jobs Act passed last fall required rental property owners to issue Forms 1099 to service providers to which they paid $600 or more during the year. The provision applied to payments made starting on January 1, 2011 and included payments made to plumbers, painters, landscapers, accountants, and any others who were paid $600 or more in the course of earning rental income.
Many businesses and industry organizations have been lobbying Congress to repeal these requirements because of the massive increase in record keeping that would be necessary to comply. This repeal means that Form 1099 reporting rules are back as they were before, as if the expanded reporting requirements had never been enacted.
Please contact our tax professionals at 877.517.6872 if you have questions about this, or any other tax issues. |
