After a mention by President in the State of the Union Address, last week, the Senate has finally passed an amendment to repeal Section 9006 of the Patient Protection and Affordable Care Act.
Since the PPACA originally passed, last year, the small business community has been in an uproar over the perceived increase in paperwork that the new 1099 reporting requirements created for them. When I originally wrote about the new 1099 reporting requirements, back in May of last year, the post went semi-viral. I actually received hate mail!
Originally posted on D. J. Marcus's Law Blog
That's all in the past, now. The teleconference I gave on the section is now rendered invalid, as are all of the posts I have dedicated to the topic over the last eight months.
As for consequences of the repeal, Congress expected an extra $17.1 billion in tax revenue over the next ten years that it will no longer receive. Headlines across the web (I understand that Fark.com tries to be funny) laugh about the Senate making Health Care more expensive with the repeal. The problem is, it's not lost revenue. It's revenue that taxpayers are under-reporting and should be paying. The IRS can only make rough estimates about how many under-reporting incidents are intentional and how many are due to a lack of understanding of the tax code or some other honest mistake. But, given 100% compliance with tax law, every one of those $17.1 billion would end up at the Treasury Department.
So, the PPACA gets more expensive, sort of, but businesses no longer have to report every transaction over $600 on a 1099.
This should make some of you, here, who yelled at me back in May, feel a bit better.