Support for Repeal of 1099 Reporting Requirement

A provision included in the health care reform legislation will impose new costly compliance requirements for all businesses beginning in 2012.  While it applies to all businesses, it has a disproportionately negative effect on small businesses.
 
Under this new requirement, any business that pays a single vendor $600 or more for goods or services annually must issue a Form 1099-MISC to that vendor, and this form must also be filed it with IRS.  If a business hires an accounting firm to prepare its tax returns, that business must provide the accounting firm with a Form 1099-MISC, which must also be provided to the IRS.  If a business buys a computer for $600 or more from Costco, the business must provide Costco with a Form 1099-MISC.  
 
An initial attempt at repeal failed in the Senate on November 30, when amendments were introduced by both the Democrats and Republicans to the food safety bill.  Repeal of this provision was also included in the middle class tax cuts bill, which failed last week in the Senate.  We had anticipated that repeal might be included in the pending agreement to extend the Bush era tax cuts, but the Administration has indicated this is not part of the negotiated framework provision.  This could still happen, but some suspect that any action on repeal will be held over for the next Congress.  
 
CompTIA has called for repeal of this provision and reached out to 21 regional tech organization asking them to participate in this repeal effort.  Fourteen of these organizations (including CompTIA) came on board, representing a little more than 25,000 tech firms.  
 
CompTIA will continue to support repeal and has reached out to all members of Congress as well as House Ways and Means and Senate Finance Committee.  This provision should never have been enacted and must be repealed.