A section of the new federal Patient Protection and Affordable Care Act (PPACA) requiring small businesses to file information on all purchases of property and services is shaking things up in the U.S. Senate.

Late yesterday, Senate Finance Committee Max Baucus, D-Mont., released a Democratic alternative to a Republican amendment proposed last week by Senator Mike Johanns, R-Neb. Both amendments propose different changes to the health care information reporting requirements contained in PPACA.

Under section 9006 of PPACA–scheduled to take effect in 2012–small businesses are required to file an Internal Revenue Service 1099 form for all purchases of property and services worth $600 or more during the calendar year.

Previously, businesses have been required to report only when they purchase services and only when those services are from non-corporate entities, officials say.

Senate leaders have been proposing amendments in response to concerns from many small business owners who say the new reporting requirements could lead to more burdensome paperwork.

The amendment proposed by Sen. Johanns would repeal altogether the information reporting requirements for small businesses. Officials say this amendment would be paid for by eliminating the $15 billion Prevention Trust Fund, which provides Americans with access to preventive services such as cancer screenings.

The Democratic alternative proposes that businesses with less than 25 employees at any time during the year should be exempt from the requirement to file and report information. It also proposes that the threshold for reporting purchases of goods and property increase from $600 to $5,000 for businesses with more than 25 employees.

The Democratic alternative would be paid for by repealing tax cuts for the five largest oil companies with more than $1 billion of before-tax income, officials say.

This amendment would also give the Treasury Department the authority to exempt payments with minimal compliance risk–such as payments for office supplies, airline tickets and restaurant meals–from the reporting requirements.

Any amendment that is decided on would be made to the Small Business Job Acts Bill, H.R. 5297, which focuses mainly on efforts to create jobs by reviving expiring tax cuts.

The bill also includes a provision long sought by the life insurance industry that would simplify the rules dealing with partial withdrawal of funds contained in an annuity contract.

The bill also would let self-employed people deduct health insurance premiums for one year, and a third provision would let individuals with traditional 401(k), 403(b) and 457 retirement plan accounts roll assets into the Roth versions of the accounts.

The National Association of Insurance and Financial Advisors, Falls Church, Va., and the American Council of Life Insurers, Washington, are supporting the bill.