On February 2, the U.S. Senate voted to repeal Section 9006 of the Patient Protection and Affordable Care Act (PPACA). This provision would have expanded Form 1099 reporting to require business owners to include payments of $600 or more to corporations providing services or goods, starting in 2012. A bipartisan collection of business groups have opposed the provision, arguing that it would bury them in paperwork. Currently, Form 1099 reporting is not required unless services worth $600 or more are received from individuals or non-corporate entities.
The expanded Form 1099 reporting was singled out by President Obama in his State of the Union address as an expendable provision of the Health Care Reform law. It was included in the law because it would have raised about $19 billion in previously uncollected taxes over 10 years to help offset the cost of PPACA. The Senate voted 81-17 to eliminate the Form 1099 reporting requirement, with only Democrats voting against the measure. The amendment was proposed by Senator Debbie Stabenow (D-Michigan). The House has not yet considered that proposal.
The Senate voted several times last year on repealing the requirement, but all the attempts failed amid partisan bickering over how to pay for it. Republicans made an attempt to repeal the provision by taking money from the health reform law’s prevention and wellness fund. Democrats tried to repeal it without paying for it. The repeal would be paid for by requiring the Office of Management and Budget to find the funding in unspent but appropriated funds.