The U.S. Senate has voted 87-12 to repeal the new 1099 tax provision reporting requirement that was part of health care reform, which mandated that starting in 2012 all businesses must file a form 1099 when paying any business or individual $600 or more for goods or services.
The Senate’s approval of the House-passed legislation is the last step before it goes to President Barack Obama.
The new requirement, Section 9006, of the 2010 federal health care law, would have impacted as many as 40 million American businesses.
Though all businesses would have been affected, small businesses were seen as being particularly hard hit because they lack the legal and accounting knowledge needed to comply and deal with the added paperwork.
Also part of the repeal is a less pervasive but more imminent part of the jobs bill passed in September that required landlords to file 1099s on all services of more than $600 starting this year and goods beginning in 2012.
The businesses would have been required to submit a form to both the vendor and to the Internal Revenue Service.
It is also meaningful on the recipients’ end. The vendor who sells the goods to the business will be receiving the 1099s, and that would be another item to cross check against paperwork at the end of the year. The IRS says about 85 million 1099s are filed each year.
The National Small Business Association predicted an average business would have to file 95 forms a year under the new rules, compared to the current average of fewer than 20.
President Obama has indicated he will sign the repeal.
The California Society of CPAs' San Francisco Chapter awarded The Young & Emerging Professional of the Year Award to Ethan Lee, certified public accountant in the consulting practice of Burr Pilger Mayer’s Santa Rosa office.
Mr. Lee specializes in forensic accounting and business valuation. The award is intended to recognize the diverse contributions of young and emerging professionals in a professional or personal capacity. The award also acknowledges and promotes the enormous strides made by young and emerging professionals to be viewed as leaders in their professional competency.
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