Posted on 10/22/2010 7:09:07 AM PDT by FromLori
The new rules on 1099 forms, which were attached to the health care bill and are set to go into effect in 2012, call for all businesses, no matter how small, to file 1099 forms for goods as well as for services. That sounds like a technicality, but it’s got small business up in arms.
Here’s why it matters, and what you need to know.
What exactly is the rule, anyway?
The new rule requires all business to file 1099 forms for goods as well as services, if those goods cost over $600 annually (the current threshold). It also gets rid of the distinction between corporations, which previously did not need to receive 1099s, and unincorporated entities, which did. The rule is slated to go into effect in 2012.
Who will it affect?
It will affect all businesses, including sole proprietors, consultants, self-employed people and freelancers, who are considered businesses for tax purposes, but may not think of themselves that way. It also will apply to charities and other tax-exempt organizations. The National Taxpayer Advocate, based on Internal Revenue Service data, figures that it will affect 26 million sole proprietorships, 4 million S corporations, 2 million C corporations, 3 million partnerships, 2 million farms, 1 million charities and other tax-exempt organizations, and likely more than 100,000 federal, state and local government entities. All told, that’s more than 38 million taxpayers and taxpaying entities.
What does it mean?
(Excerpt) Read more at blogs.reuters.com ...
What this means is billions of additional bookkeeping expenses for small business just to feed tons of useless paper into the Federal machine. This is why IRS is hiring 16,000 new agents.
And people around here say I’m a kook for wanting to abolish the IRS. And people around here would not support a candidate that wanted to abolish the IRS.
You get the government you deserve.
If you have a tyranny, you probably prefer to be a slave to government.
And dems wonder why businesses don’t want to hire.
THEY DON’T TRUST YOU!!!
REPEAL
This is just one more reason...
Yes, REPEAL the 16th, 17th and several other amendments.
I’m trying to figure out who put this in the Obamacare law?
Every Dem is on record (even Obama, I believe) wanting this removed.
Weird.
this is all devised to kill the little businesses, especially the sole propieter.
Everyone must work for big brother.
I have to believe this will be repealed, or at least amended.
Hopefully, when the Republicans take over Congress, they can link the repeal of this to some other conservative legislation thereby forcing Obama and the Democrats to either swallow that other legislation, or be held responsible for the 1099 fiasco that will take place during the 2012 election season.
“If you have a tyranny, you probably prefer to be a slave to government.”
How elitist of you.
McConnell thinks if they repeal this part of the Scam we will go away and leave him alone.
If you don't file electronically the penalty is $50 per item after the 249th paper copy.
The electronic filing is just the A copy. You still have to stuff the B copy in an envelope and mail it to the recipient. Keep the C copy on file for at least 3 years.
This makes me want to go out of business...
This has got to be repealed in the lame duck session!!!!!
This one will get repealed, or just not enforced. Obama wouldn’t veto a rider to a tax bill that made the 1099 requirement go away.
Crap. How will it handle reimbursed employee or partner purchases? For example, if I pay for a hotel room with my own credit card and then file for reimbursement will the company have to send a 1099, or will I have to do it because I'm officially a partner rather than an employee? If I and an employee travel together, will I have to send my own 1099, while the company has to track the employee's purchase for a separate 1099?
And all of this was so Congress could claim "$XXXX billions of taxes are not collected because of tax cheating. With this change we can now collect it in the future so we can spend it now on Obamacare." It's like saying "I'll start running five miles a day next year, so I can eat cheesecake every day right now."
This thing is a disaster. I work for a small business which is an S-Corp. Currently, we annually send out about 10 1099’s to various vendors/independent contractors who are not corporations. Under this law, that number will go up to about 200 since corporations have to be included. We have the software to track the payments, but it will still take 5 times as long to process them, not to mention the initial setup of having to send W-9’s to all the corporations we do business with to collect federal ID numbers. Then there is the other side of the coin. Our customers will be sending us W-9’s to fill out as well.
This is one of the first issues to address with the MrB strategy for the next congress:
1) Find the most egregious encroachments on freedom in 0bamacare.
2) Wright specific, one page, easily understandable bills to repeal these INDIVIDUAL issues in 0bamacare. Make sure to include “whereas” clauses stating the harm done.
3) Post the bills on the internet.
4) Pass them through both houses of Congress and dare 0bama to veto them.
This is one of the first issues to address with the MrB strategy for the next congress:
1) Find the most egregious encroachments on freedom in 0bamacare.
2) Write specific, one page, easily understandable bills to repeal these INDIVIDUAL issues in 0bamacare. Make sure to include “whereas” clauses stating the harm done.
3) Post the bills on the internet.
4) Pass them through both houses of Congress and dare 0bama to veto them.
As an officer in a charity, I can tell you that this rule is giving our finance officer fits. It’s turning a volunteer effort on her part into a full time job.
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