Supporting Small Businesses in the Senate
06:18 PM EST
This evening, Senators will have the chance to support small businesses when they vote on a plan to eliminate a requirement that businesses report to the IRS all purchases that exceed $600. Known as the 1099 provision this policy, which had bipartisan support, helped pay for the new health reform law. The provision was intended to narrow the gap between taxes owed and taxes paid. And while our Administration is deeply committed to closing the tax gap, the new rule places too great a burden on small businesses. Our Administration has already taken a number of steps to alleviate the burden, including exempting transactions completed with a debit or credit card. In June, the Small Business Administration sent a letter to small business owners regarding some of their efforts to minimize the burden of this new rule. And in November, the President said:
“You know, for example, I know one of the things that’s come up is that the 1099 provision in the health care bill appears to be too burdensome for small businesses. It just involves too much paperwork, too much filing. It’s probably counterproductive. It was designed to make sure that revenue was raised to help pay for some of the other provisions, but if it ends up just being so much trouble that small businesses find it difficult to manage, that's something that we should take a look at.”
Today, Small Business Administrator Karen Mills issued a memo to small business owners on the Administration’s support for repealing this provision. A copy of the memo is below.
SUBJECT: Senate voting today on 1099 reporting requirement repeal
November 29, 2010
Dear Small Business Owner,
Last week I wrote to you expressing the Obama Administration’s support for the repeal of the expanded 1099 reporting requirement that was included in the Affordable Care Act. As you know, earlier in the year we asked you for feedback on this requirement and what we heard was that will involve too much paperwork and will be overly burdensome.
As the Senate votes today on whether or not to roll back this requirement, I want to again express the Administration’s support for repealing the expanded 1099 reporting requirement.
Thank you again for your feedback on this important matter and I look forward to continuing to work with you to ensure you have the tools and resources you need to grow your business and create jobs.
Stephanie Cutter is Assistant to the President for Special Projects