As if physicians weren't already swamped with paperwork: A new provision of the healthcare law requires businesses to file tax forms for every vendor who sells you more than $600 worth of goods in a year. The new law will affect almost 40 million businesses, including most medical practices.
As if physicians weren't already swamped with paperwork, a little-noticed provision of the new healthcare law wants you to file tax forms for every vendor who sells you more than $600 worth of goods in a year. Unless Congress acts to repeal it, the new law will affect almost 40 million businesses, including most medical practices. The law is aimed at deterring vendors from omitting income from their tax returns and is expected to raise about $19 billion over the next 10 years.
Both Republicans and Democrats agree that the filing requirement should be repealed, but apparently election-year politics is getting in the way. In a pay-as-you-ago environment, lawmakers must find a way to replace the lost income. Republicans want to save money by tinkering with other parts of the healthcare law; Democrats want to raise taxes on international corporations. As a result, the House recently voted down a bill that would have junked the filing requirement.
Businesses are already required to file a Form 1099 when they buy more than $600 in services from a single vendor in a year. The new law would apply the same requirement to goods, starting in 2012. To comply with the law, businesses would have to maintain accurate records to make sure they report any purchases of more than $600. They would also have to get tax ID numbers from vendors to be included in the filing.
Businesses that are already straining under the load of government paperwork are aggressively lobbying Congress for repeal. They maintain that the law would make it necessary to report virtually every business-to-business transaction to the Internal Revenue Service.