Republicans in the Senate today blocked efforts by Democrats to eliminate major Affordable Care Act Form 1099 vendor reporting requirements.
Sens. Max Baucus, D-Mont., and Debbie Stabenow, both tried to add a 1099 fix to H.R. 4853, the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010.
Form 1099 is the form businesses and others use to report a wide variety of payments to the Internal Revenue Service. A broad new 1099 reporting requirement is part of the new Patient Protection and Affordable Care Act (PPACA), a part of the Affordable Care Act package.
The provision, set to take effect in 2012, is supposed to raise $18 billion over 10 years by requiring all businesses, tax-exempt organizations, and federal, state and local government entities to issue Form 1099 to vendors from whom they buy goods totaling $600 or more during a calendar year.
Some critics have suggested that strict enforcement of the provision could require a free-lancer who buys a $700 computer from the local discount store to send a Form 1099 to the discount store.
“Small business owners want us to repeal form 1099 reporting requirements so they have additional resources to grow their businesses and hire new workers,” Baucus said in a statement after the vote on the bill. “Today we should have – and could have – delivered the paperwork relief small businesses need. Eliminating these paperwork requirements is a simple, common-sense idea that senators on both sides of the aisle support and it is deeply disappointing to see partisanship stand in the way of progress for small business owners.”