The Senate will soon vote on Sen. Mike Johanns' (R-Neb.) legislation to repeal a 1099 tax paperwork mandate that would force businesses to waste resources on paperwork instead of hiring new workers. Johanns' legislation is fully paid for while a Democrat alternative that will also be considered by the Senate on November 29 adds $19 billion to the deficit.
"Senators will have a clear choice between a fiscally responsible end to the 1099 mandate or one that tacks on billions more to the health care law’s already bloated price tag and adds to our national debt," Johanns said. “I urge my colleagues to relieve small businesses of this costly and job-killing paperwork mandate without giving future generations an even deeper fiscal hole to dig out of. My legislation would eliminate the burdensome 1099 mandate without adding to the deficit."
The Johanns amendment repeals Section 9006 of the health care law, which mandates that every business, charity, and local and state government entity submit 1099 forms for business transactions totaling $600 or more in a given year. The mandate adds routine business expenses like phone, office products, shipping costs and increases businesses' reporting requirements by as much as 2,000 percent. One small business owner from Nebraska conducted a cost analysis for his business and expects this tax paperwork mandate to add $23,000 annually to his expenses.
The Johanns 1099 repeal will be considered as an amendment to the food safety bill, immediately followed by consideration of 1099 repeal with no offsets introduced by Sen. Max Baucus (D-MT).
Johanns introduced 1099 repeal legislation on July 14, 2010 and proposed an amendment to the Small Business Jobs Act on September 15, 2010 that would have fully repealed the tax paperwork requirement.
Johanns' leadership on 1099 repeal: