Hear that? It was the collective PHEW! of small business owners from across the nation who have been sweating a tax-compliance mandate in last year’s health-care law. Well, sweat no more. President Obama signed a bill today repealing the IRS 1099 reporting mandate, giving a victory to business and trade groups – the Electronic Security Association (ESA) among them – that railed against the requirement.
Set to become law in 2012, business owners would have been required to use 1099 IRS tax forms to report all payments for goods of $600 or more annually to other businesses. The objective of the provision was to track more money owed in taxes, which would have been used toward the cost of implementing the national health-care law.
“Small business owners are the engine of our economy and because Democrats and Republicans worked together, we can ensure they spend their time and resources creating jobs and growing their business, not filling out more paperwork,” Obama said today in a statement released by the White House.
Both Republicans and Democrats agreed the repeal was necessary but bickered vehemently on how to get it done. It all came to a head on April 6 when the Senate voted overwhelmingly in favor of a House proposal, without changes, permitting it to go directly to Obama’s desk.
To help make up the forgone revenue from the original tax-reporting requirement, the law signed by Obama today includes provisions that will limit certain health-insurance tax credits in the health-care law.
Rodney Bosch | Managing Editor
