Thank goodness Congress realized the heavy burden they placed on small business owners with the recently expanded 1099 provision that was buried the health care reform bill. They have repealed it by a margin of 87 to 12. Business groups and business owners across the country made their voices heard and the legislature listened.

According to an article in the Phoenix Business Journal, written by Kent Hoover, Washington Bureau chief, the senate voted to “repeal a health care reform provision that requires businesses in Arizona and across the country to file a 1099 form with the Internal Revenue Service any time they spend more than $600 a year with another business.”

Businesses already were required to file 1099s for payments of more than $600 to unincorporated service providers. That provision still applies. The health care reform bill expanded this requirement in 2012 to goods as well as services, and applied it to all types of vendors. Small businesses contend this expansion would create a paperwork nightmare, forcing many of them to file hundreds of 1099 forms instead of just a few. One business owner that I talked to said he might have had to file as many as 3,000 forms!

“Small business owners oppose anything less than complete, immediate and certain repeal,” read a letter to senators from the Small Business & Entrepreneurship Council.

“We applaud Congress for taking a positive first step toward removing the excessive cost burdens and uncertainties imposed on franchise small businesses as a result of the health care law,” said Steve Caldeira, president and CEO of the International Franchise Association.

You can read the rest of this article at Phoenix Business Journal.

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