Thursday, October 28, 2010

Collins On 1099s

The junior senator makes a compelling argument to scrap a weird record keeping provision of the health care law:

At issue is a provision that, starting in 2012, will require all businesses to submit a Form 1099 to the IRS for every business vendor from whom they buy more than $600 in goods or services in a year...

According to the National Taxpayer Advocate Service, this onerous provision will hit some 40 million businesses, charities, and other organizations. It is estimated that this requirement will add more than $190 billion in administrative costs to businesses at the worst possible time. These costs will weigh most heavily on small companies.

Currently, businesses must provide 1099s only for freelancers and other nonemployee service providers that are not incorporated...Under the new rule, businesses will have to generate 1099s for every transaction that crosses the $600 threshold--goods as well as services. Office supplies, building materials, gasoline, meals and lodging, shipping costs, cell phones, and Internet service are but a few of the countless everyday business expenses that will have to be reported to meet this crushing new paperwork demand.


Last month, I joined an effort to strike it from the law through an amendment to a small business bill...I have co-sponsored stand-alone legislation to repeal this senseless, counter-productive provision, and will persist until it is done.
Like Maine's senior senator, Collins often cloaks her fealty to giant corporations with rhetoric about protecting "small business."

But as far as I can tell, this really is about staving off a paperwork nightmare for genuine small businesses. Collins deserves credit for highlighting it.

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