The Senate voted 87-12 this week to pass legislation to repeal the expanded 1099 reporting provision that was included in the health care reform bill. This provision would have required businesses to file 1099 forms with the Internal Revenue Service for all vendors from whom they bought $600 worth of goods or services within a year.
"The repeal of this onerous requirement is great news for farmers and ranchers," commented Peter Orwick, executive director for the American Sheep Industry Association. "This lets our producers concentrate on the details of their business -- growing quality and safe food for consumers."
The Senate bill mirrors legislation passed in the House of Representatives on March 3 to repeal the 1099 tax-reporting rule, H.R. 4. The bill is now on the president's desk for his signature.
Taxpayers engaged in a trade or business are still required to provide a Form 1099 to every individual payee to whom they made payments for rent, services or interest totaling $600 or more in any taxable year. For example, this applies to ranchers who lease land for grazing rights or for farmers who rent land for crop production totaling more than $600 per payee during the tax year.