Small business cheered yesterday as a bi-partisan vote in the Senate took
place to repeal the 1099 requirement that was placed into the massive
Healthcare bill passed last year. This requirement had been seen as a
massive ‘tax’ on both people, and small businesses as it would have
required anyone performing any transaction equaling or exceeding $600.00
to issue a 1099 form as part of the process.
The sheer cost of doing this, coupled with the cost many people would
have to incur by hiring accounting help just to deal with this
provision, could have burdened small businesses to the point that up to 40% would have had to close their doors, or layoff workers.
The other good news here is that it is likely the President would
sign a repeal of this provision once the House passes the bill in their
chamber. President Obama spoke about the 1099 requirement in his State
of the Union address as something the Democrats would be willing to
compromise on, and as you can see by the 81-19 vote in the Senate, both
sides moved quickly to address it.
Democrats however, see the need elsewhere to make up for the
potential $17 Billion this requirement would have brought in yearly
taxes to pay for Healthcare, and already Senators like Carl Levin of
Michigan are presenting amendments to place an additional tax on oil
companies to make up for the potentially lost revenue.
Hat Tip: Jasonn