RSS Feed MenuMy latest column for The Week looks at an obscure provision in the Obama healthcare bill which will place a serious new burden on small business owners.
Small business owners face a world of troubles these days: a weak economy, impending healthcare mandates, the prospect of higher taxes.
But one concern you hear about more and more is a huge new expansion in their IRS reporting requirements — a paperwork nightmare that will commence in 2012.
I got an earful on the subject after a recent speech to a group of employers in a small vacation town. They owned shops, a garage, restaurants. They did all their own bookkeeping at nights and on weekends. They did not enjoy it, but they were used to it. But now, they feared their lives were about to be consumed by a new bureaucracy.
They have reason to be afraid. Right now, business owners file two forms when they employ people: a W-2 for employees and a 1099 for freelance contractors. A typical small business files 10 such forms, at a cost of 3-5 hours of time per year.
Embedded in the new healthcare law, however, is a staggering requirement: using a new form — the 1099k — small businesses will have to start reporting all their purchases of goods from other businesses. (You can see a draft version of the 1099K form on the IRS website.)
Did you rent a car or stay in a hotel? 1099K.
Buy ink and paper from Staples? 1099K.
Lease space in a local mall? 1099K.
Collect revenue from PayPal, eBay or Amazon merchants? 1099K.
And don’t forget to collect each company’s taxpayer ID number while you are at it!
Click here to read more.
Oldskool // Jul 29, 2010 at 3:59 pm
“They did all their own bookkeeping at nights and on weekends. They did not enjoy it, but they were used to it. But now, they feared their lives were about to be consumed by a new bureaucracy.”
The new law appears to be an attempt to collect taxes that are going unpaid. Being a small business owner I don’t expect it will be any more onerous than anything else we’re required to do. Unless of course I wasn’t paying certain taxes, THEN I might be concerned.
So what’s the answer, Republicans? More tax cuts? That’s what we keep hearing. Do we have huge bills that need to be paid or not? You can’t have it both ways. If you’re going to explode the deficit with unpaid tax cuts and unpaid wars, what’s your answer?
Or is the business of the country not really business, it’s all about politics and you have to squeeze every issue to within an inch of it’s life to gain a meager advantage even though your stance on each issue depends on which day of the week it is or whoever you happen to be arguing with.
Bunch of hypocritical retards.
sdspringy // Jul 29, 2010 at 6:31 pm
Nice catch Mr.Simm, you will not get any satisfaction from the Libs here though. Even with a one foot in their mouth and the other stepping on their dick they will continue to argue.
And of course who will verify the contractor provided TIN is valid, and if it isn’t whose responsible.
Who will verify the TIN provided is correct and not some other business’s TIN, which will create the confusion when 1099s don’t match.
If you have a business you have an accountant, if you are a small business you do your own accounting. This will be a problem for small businesses.
Good article David
mickster99 // Jul 30, 2010 at 12:49 am
Hey Mr. Republican Cojones. You need to catch up here. In case you haven’t heard (don’t you listen to Beck, Levin, Malkin, Fox) Obama is methodically destroying the United States and it may be too late to save us. First he destroyed wall street, then gobbled up the car companies, then took over the health care industry, and now has totally destroyed capitalism with his financial reform. He’s executing the Alinsky-Weather Underground Agenda perfectly. Plus he’s got a 20 billion dollar slush fund from BP to have carte blanche to launch massive attacks using the ATF on conservatives. He makes Dom Corleone seem like an amatures. But get this. I have it good authority he has a secret plan to arrest all conservative talk show and radio hosts and bloggers. You have heard about the night the long knives. They will be fitted for orange jump suits and then moved to death camp trailers at secret undisclosed locations in Lousianan where they will not be tortured but will be subject to stress just short of organ failure. Ok. It might hurt but it’s not torture. And you expect us to get excited about a few small business. Get real Mr. Cojones.