As early as today, President Obama is expected to sign into law a bill that repeals a new business reporting requirement involving IRS Form 1099. The objectionable provision had been created by the March 2010 health care reform law. It is the first substantive change to the health reform law – additional efforts to modify the law will be difficult in the current environment.
In passing the bill (H.R. 4), Congress eliminated a measure that, starting in 2012, would require all businesses to report to the IRS every transaction of $600 or more with any vendor. In the end, both political parties supported repeal of the 1099 provision, despite it providing a projected $19 billion in revenue to the federal treasury.
Repeal of the provision had been among SHRM’s top legislative goals in 2011. Last month, during our Employment Law and Legislative Conference, more than 200 HR professionals visited Capitol Hill, urging their elected officials to support repeal of the 1099 requirement. SHRM President and CEO Hank Jackson also wrote a letter to congressional leaders, asking them to provide HR professionals with some certainty by eliminating the controversial provision. To review the text of the letter, click HERE.
The deciding congressional vote came this Tuesday, April 5, when the Senate agreed to the House bill by a vote of 87-12. The bill was sponsored by Rep. Daniel Lungren (R-CA), pictured above.