Senate Passes 1099 Repeal

Senators have passed legislation (H.R. 4) to repeal the 1099 reporting provision by a vote of 87-12. Sixty votes were needed to adopt the measure.

The House has already passed this bill, so it now goes to President Obama.

According to The Hill, this 1099 provision requires businesses to file forms “with every business with which they buy at least $600 in goods and services each year.” It was included in the health reform law.

With repeal, members had to find a way to “make up for $22 billion in lost revenue as projected by the Joint Committee on Taxation.”

This legislation would pay for repeal by requiring “taxpayers who receive federal health insurance subsidies to pay back the IRS if they earn above 400 percent of the poverty line and are deemed ineligible.”

Some taxpayers could receive a subsidy even though they didn’t qualify because the data is self-reported and is based on a two-year window that could see their eligibility change significantly during that time.

Under current law, those receiving the subsidy are required to report going over the level that makes them ineligible for premium assistance, according to Republican staff.

Prior to passage of the repeal legislation, members defeated an amendment offered by Senator Robert Menendez (D-NJ) by a vote of 41-58. Sixty votes were needed to adopt his amendment.

It would have required “further study of the effects of the offset proposed by Republicans.”

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