Johanns, Nelson Healthcare Law Amendments on 1099 Fail

Requirement to report vendor payments of $600 or more considered a big burden to small businesses

More On Legal & Compliance

from The Advisor's Professional Library
  • Trading Practices and Errors When SEC-registered investment advisors conduct annual audits of firm policies and procedures, they should pay close attention to trading practices.  Though usually not required to, state-registered advisors should look at their trading practices and revise policies that do not fully protect clients.
  • Differences Between State and SEC Regulation of Investment Advisors States may impose licensing or registration requirements on IARs doing business in their jurisdiction, even if the IAR works for an SEC-registered firm.  States may investigate and prosecute fraud by any IAR in their jurisdiction, even if the individual works for an SEC-registered firm.

A provision of the health care reform legislation that requires businesses and nonprofits to file 1099 forms with the IRS for all payments of $600 or more to a single vendor has been a bugaboo since its passage, with businesses and trade groups calling for its repeal.

Two different attempts to do that Tuesday, in the form of amendments to the small business relief bill that passed the Senate, were defeated.

The Johanns amendment (SA 4596), proposed by Sen. Mike Johanns, R-Neb., would have repealed the requirement altogether, but would have paid for the lost revenue the requirement would have generated by gutting the Prevention and Public Health Fund, according to the Center on Budget and Policy Priorities. It failed.

The Nelson amendment (SA 4595), proposed by Sen. Bill Nelson, D-Fla., sought to increase the requirement floor from $600 to $5,000, and reduce tax subsidies and loopholes for oil companies to pay for the measure. It, too, failed.

The National Association of Mutual Insurance Companies (NAMIC) expressed concern on Wednesdayin the wake of the vote on the Johanns amendment. Jimi Grande, senior vice president of federal and political affairs for NAMIC, said in a statement, “Only in Washington would you find the twisted logic that rejects the Johanns amendment, which provides a clear benefit to businesses and charities, from a bill designed to provide relief for small businesses.”

Prevention Instituteexpressed gratitude at the defeat of the Johanns amendment, calling it a “victory for prevention.” In a statement, Sen. Tom Harkin, D-Iowa, said, “Today the Senate voted to block an attack on the Prevention Trust Fund—an attack that represented the same old penny-wise-pound-foolish thinking that now makes America's health care system so costly and ineffective.”

The Prevention Institute cited statistics in favor of retaining the Prevention and Public Health Fund: “Medical costs fall by about $3.27 for every dollar spent on wellness programs and absenteeism costs fall by about $2.73 for every dollar spent. Workplace wellness programs have long-term health and cost-saving benefits, saving one company $4.8 million in employee health and lost work time costs over nine years.”

Reprints Discuss this story
This is where the comments go.