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April 19, 2011

Expanded 1099 Reporting Requirements Repealed

New law nixes 'crushing administrative burden'


In the April edition of Church Finance Today, Richard Hammar previewed the possible repeal of the expanded 1099 reporting requirement included with the Patient Protection and Affordable Act (last year's health care reform legislation).

The requirement would have required all persons or entities engaged in a trade or business (including churches and nonprofits) who make payments to a "non-employee" in any year of $600 or more to report it to the IRS on Form 1099-MISC. As Rich explains, the requirement was designed "to improve tax compliance based on the assumption that payees are more likely to correctly report their taxable income if they realize that payors are reporting that income to the IRS."

Controversy erupted because of the requirement, largely because many believed it would "impose a crushing administrative burden on countless nonprofit and for-profit entities as a result of the obligation to file billions of new 1099 forms," Rich explains.

Earlier this month, the Senate passed legislation that included a repeal of the requirement. On Thursday, President Obama signed it into law.

Rich will cover this development more extensively in an upcoming issue. For more updates on the health care reform for churches, join Rich on May 4 through this special live webinar co-presented by Christianity Today International and the Evangelical Council for Financial Accountability.

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Posted by Matt Branaugh on April 19, 2011 8:00 AM

Related Tags: finances, health care, IRS, Law, money, tax

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