That's according to a CNN report. "[J]ust a few lines buried in the 2,409-page document ... mandates that beginning in 2012 all companies will have to issue 1099 tax forms not just to contract workers but to any individual or corporation from which they buy more than $600 in goods or services in a tax year. The stealth change radically alters the nature of 1099s and means businesses will have to issue millions of new tax documents each year.”
According to the National Taxpayer Advocate, an independent office within the IRS, this new provision will affect about 40 million taxpayers, including 26 million sole proprietors and one million charities. The National Federation of Independent Businesses (NFIB) adds that new Form 1099 expansion is “another crippling paperwork mandate that unfairly targets small businesses," and estimates average costs associated with tax paperwork is about $74 per hour.
“John Callahan should take heed – this is what happens when you blindly support a bill you didn’t bother to read,” said Congressman Charlie Dent in a news release. “This is only one of dozens of mandates in the health care bill that will cost more American jobs.”
Dent is a cosponsor of HR 5141, the Small Business Paperwork Mandate Elimination Act, which would repeal this unnecessary and costly piece of red tape for American job creators.
The 1099 provision has been derided by Democrats and Republicans alike. Four Democratic Senators - Mark Begich (Alaska), Ben Nelson (Nebraska), Jeanne Shaheen (New Hampshire) and Evan Bayh (Indiana) – have publicly expressed concern about the regulation and asked the IRS to correct it administratively.