A bill has been introduced to eliminate the new Form 1099 filing requirements that were part of the healthcare reform bill.
For a press release announcing the new bill, see here.
Under the new Form 1099 rules, which will become effective in 2012, people in business will have to issue Forms 1099 to other businesses they pay more than $600 for goods during the year. This is a dramatic departure from prior law, which did not require the issuance of 1099s to corporations for goods.
As summarized by the IRS:
“For example, if a self-employed individual makes numerous small purchases from an office supply store during a calendar year that total at least $600, the individual must issue a Form 1099 to the vendor and the IRS showing the exact amount of total purchases.”
In the press release announcing this bill, the new Form 1099 requirement was summarized this way:
“The provision forces all businesses, charities, and state and local governments to file 1099 forms if they purchase $600 or more in goods from another business throughout the year. This includes everything from supplies and shipping costs to phone and internet services.”
So, solepreneurs, for example, will have to issue 1099 forms to office supply stores if over the course of the year they purchase more than $600 from any one office supply store, or if any one purchase exceeds $600.
It is unclear what the likelihood of passage is.
For coverage from The Hill, see here.