Members of the House panel responsible for making tax laws on Thursday approved two bills to repeal the contentious 1099 federal reporting requirement included in the health reform law.
House bills take aim at 1099 rule
The House Ways and Means Committee first passed H.R. 4, the Small Business Paperwork Mandate Elimination Act of 2011, which overturns the provision in the Patient Protection and Affordable Care Act requiring businesses to file a form with the Internal Revenue Service for every vendor with which they had conducted a transaction worth $600 or more. But that bill does not include a way to pay for the expected revenues that the provision would have generated, which is the aim of the second bill.
Introduced this week by Committee Chairman Dave Camp (R-Mich.), H.R. 705, or the Comprehensive 1099 Taxpayer Protection and Repayment of Exchange Subsidy Overpayments Act of 2011, would not only repeal the Form 1099 reporting requirement for businesses, but it would also repeal an additional 1099 requirement for owners of real estate, and reduce any overpayments in health insurance exchange subsidies—in the form of refundable tax credits—under the reform law.
According to analysis from the Joint Committee on Taxation—a nonpartisan committee of the Congress with a professional staff of economists, attorneys and accountants who assist members on tax legislation—the reduction in the number of overpaid exchange subsidies would be about $24.9 billion over 10 years. Democrats argue that middle-income Americans will be forced to pay higher taxes in this proposed bill.
The Senate has already passed legislation to repeal the 1099 requirement, and Camp told reporters after the meeting “I presume there we'll have a conference” on the issue.
He did not say which of the two committee-approved bills he thought would eventually make to the House floor for a vote but said "the one that hits rental property is very far-reaching."
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