May 01, 2011

 

 Lawmakers send 1099 repeal to the president

 
 
posted April 18, 2011
 

Republican and Democratic senators passed H.R. 4 in April, repealing an unpopular tax-reporting provision of the health care law.

At press time, the repeal was awaiting the signature of President Obama, who was expected to sign the bill into law.

The 1099 reporting requirement, part of the Patient Protection and Affordable Care Act, would have required businesses to submit to the IRS a report on any corporations with which they had transactions totaling $600 or more a year.

The provision was expected to generate billions of dollars in revenue and help cover the costs of implementing the health care law. But the requirement was widely criticized—even by President Obama himself—as an unnecessary burden on small businesses (see JAVMA, April 1, 2011, page 831).

AVMA President Larry M. Kornegay worried veterinarians would be slammed with a "massive amount of red tape" if the 1099 provision were implemented in 2012 as scheduled. "The damage created by this requirement on small businesspeople, such as veterinarians, far outweighs the tax revenues it would generate," he had said.

While Republicans and Democrats had agreed for some time that the requirement had to go, for months they couldn't agree on how to pay for the repeal. Lawmakers reached a compromise with H.R. 4, which House lawmakers passed in March and sent to the Senate, where the legislation was approved without amendment.