The Latest 1099 News

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As we have previously detailed in various stories here, due to the recently passed health care reform law, 1099 requirements are set to become extremely onerous on all businesses, and even some unsuspecting individuals.  Taxpayer grumblings have been heard, and there is a lot of activity brewing to at least tame the upcoming requirements a bit.  We thought we would give you a quick run down of where things stand.

– As detailed in our story here, starting in 2012, all payments from businesses totaling over $600 are required to be reported on a 1099.  That is, on January 31st, 2012, for 2011 payments.  The big change is that corporations must now receive 1099’s, and payments for purchases of goods, and not just services, must now be reported.

– The recently enacted Small Business Jobs Act contained a provision requiring property owners who receive rental income, to issue Forms 1099 to service providers.

– According to Webcpa, one of the originators of this law is now introducing legislation that would repeal the new 1099 requirements.

– The American Institute of Certified Public Accountants have asked for a repeal of the the new 1099 requirements.  In this letter to the US House of Representatives, dated November 16, 2010, the AICPA has written to provide lawmakers with the accounting industries view of the impact of the new 1099 rules.

We will continue to monitor these rules and keep you informed.

Update: In an open letter to small businesses, the head of the US Small Business Administration has called for the repeal of the new 1099 requirements.   Learn more here.

12/2/10 Update: This week, an effort to repeal this unpopular 1099 filing requirement failed to pass in the Senate.  The Senate was twice unable to get the 67 votes needed to repeal the provision.  However, Senate Finance Chairman Max Baucus said Monday that he and Sen. Mike Johanns have agreed to work out a compromise to repeal the 1099 provision.  We will continue to post updates here.

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