H.R. 4, the Comprehensive 1099 Taxpayer Protection and Repayment of Exchange Subsidiary Overpayments Act of 2011, passed yesterday by the House, would repeal the new 1099 reporting requirements created by the Patient Protection and Affordable Care Act and the Small Business Jobs Act of 2010 effective after December 31, 2011. The bill goes now to the Senate, who passed their own 1099 repeal as an amendment attached to the FAA Air Modernization and Safety Improvement Act.
The Senate repeal only addresses Sec. 9006 of the healthcare act and does not address the Jobs Act provisions, which provide for increased 1099 reporting requirements for landlords and others who receive rental income. How these two bills will or will not be reconciled remains to be seen. The Obama administration has criticized H.R. 4, which seeks to offset the revenue loss of repealing the increased 1099 requirements by adjusting the repayment requirements on a tax credit introduced in the healthcare act to help lower income individuals pay for healthcare. How the President would respond to H.R. 4 if it came across his desk in its current form is unclear.
For more on 1099 repeal and other tax concerns, contact the Illinois tax attorneys at Horowitz & Weinstein.