REJOICE – CONGRESS OVERTURNS ENHANCED 1099 REPORTING REQUIREMENTS

In earlier newsletters, we had notified you of two new 1099 reporting requirements for businesses and rentals.  These included:

• For Rental Owners – The new requirement for rental owners to report annual payments of $600 or more to service providers such as a pool service person, handyman, gardener, management company and other unincorporated service providers effective for the 2011 and future tax years.
• For Business Owners – The new requirement to include incorporated entities in the business 1099 reporting requirements and expanding the scope to include purchases in addition to payment for services.  This provision was to become effective for the 2012 and subsequent tax years.

In response to overwhelming objections from business leaders, business organizations and accounting professionals nationwide complaining about the tax compliance burden these new requirement impose on taxpayers, particularly small businesses, Congress has repealed these requirements.