One of healthcare reform’s “funding source” provisions that could significantly impact small businesses may be modified or repealed. The provision, which will require businesses to file 1099 tax forms reporting any purchases they make of goods or services over $600, was intended to reduce tax evasion. It was also projected to raise $17.1 billion over 10 years toward the cost of the healthcare law.
However, the provision has caused alarm among small businesses, who feel that it could prove extremely labor-intensive and expensive. Members of the House of Representatives and the Senate have taken notice, and the Senate is scheduled to vote September 14, 2010 on two amendments to an unrelated bill: One would eliminate the 1099 provision; the other would exempt businesses with fewer than 25 employees, raise the reporting threshold to purchases above $5,000, and exclude those made with a credit card.
© 2010 Parsonage Vandenack Williams LLC
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