North Country Congressman Bill Owens introduced a bill this week aimed at repealing the 1099 reporting requirement included in last year's health care reform legislation.
The bill, which Owens calls the Small Business Tax Relief Act of 2011, would repeal a provision included in the health care bill that requires businesses to submit IRS Form 1099s for every business-to-business transaction of $600 or more.
The measure currently applies to both property and service transactions. Owens says small businesses, in particular, are already overburdened with tax paperwork and reporting requirements.
"There is near universal agreement that this expanded 1099 reporting requirement will only further increase the cost and complexity of complying with the tax code for small businesses," Owens said, noting that it's critical to repeal the provision before it takes effect in 2012.
According to Owens, the 1099 provision was included in the Affordable Care Act in order to raise revenue by reducing the tax gap.
The original hope, Owens says, was to cut back on the amount of income that currently goes unreported by large corporations by requiring more oversight of property and service purchases.
But instead, the measure unfairly punishes small businesses.
Owens firmly supports the current health care legislation and voted against a Republican measure to repeal the bill last week.
"Key provisions of the health care law have already brought critical benefits to thousands of upstate New Yorkers," Owens said. "However, as with any broad piece of legislation, we need to revisit some of the policy and fine-tune the parts of the law that do not work."
The 1099 repeal bill currently has 13 cosponsors in the House. Owens introduced a similar piece of legislation last year, but the measure was voted down.