Thursday, May 27, 2010

Healthcare Bill Surprise: 1099 Nightmare

A clause buried in the bill requires more tax forms—and small business will bear the brunt

By John Tozzi - Focus On Entrepreneurs, Bloomberg Businessweek

Anyone who makes it to page 737 of the massive health-care bill approved by Congress in March will find a three-paragraph section that has nothing to do with hospitals, doctors, or drugs. The provision, inserted by Democrats on the Senate Finance Committee to help offset the cost of the bill, requires companies to report to the IRS payments of more than $600 a year to any vendor. The intent is noble: to capture $2 billion or more a year in taxes on income that currently goes unreported by contractors and small businesses.

Business advocates fear it could generate a flood of paperwork. While the provision affects all companies, small businesses will be slammed the hardest because they often lack the compliance departments and legions of accountants that corporations retain on staff. CONTINUE HERE [Full Article]

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