Section 9006 of the health care bill — just a few lines buried in the 2,409-page document — mandates that beginning in 2012 all companies will have to issue 1099 tax forms not just to contract workers but to any individual or corporation from which they buy more than $600 in goods or services in a tax year.
It has now come to light what a burden this aspect of the health care reform is going to have on small business.
Democrats and Republicans want to repeal it, but getting them to work together on the issue is proving difficult in an election year.
Republicans want to repeal the filing requirement and pay for it by changing other parts of the new health-care law, a strategy that Democratic leaders won’t support. Democrats want to repeal the filing requirement and pay for it by raising taxes on international corporations and limiting taxpayers’ ability to use special trusts to avoid gifts taxes. Republicans won’t support that.
The House rejected the Democratic bill Friday after Democratic leaders brought it up under a procedure that requires a two-thirds majority for approval. The vote was 241-154, with nearly all Democrats voting in favor of the bill and nearly all Republicans opposed.
Its important to note that both political parties recognize how this law is going to impact small business. Both sides are willing to repeal it but have different ideas on how to make up the funding. This is very important because there will be many more debates on aspect of the health care reform that will need to be appealed or changed.