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advocacy community education
13
The American Institute of Certified
Public Accountants (AICPA) called on
Congress this week to repeal what it
considers burdensome information
reporting requirements placed on busi-
nesses and rental property owners by
the Patient Protection and Affordable
Care Act and the Small Business Jobs
Act of 2010.
"Businesses do not need the added
cost of more regulatory requirements
at a time when their efforts must be
focused on profitability and sustainabil-
ity," the AICPA said. "Increased prof-
itability is likely to yield more tax rev-
enues than the expansions to the
reporting requirement."
Under the Patient Protection and
Affordable Care Act, businesses mak-
ing purchases of $600 or more for
goods or services from another busi-
ness would have to provide the vendor
and the Internal Revenue Service with
a Form 1099-MISC information return.
The first 1099 forms would be due in
2013, so businesses would need to
begin keeping records in 2012. Under
the Small Business Jobs Act of 2010,
similar reporting requirements would
apply to owners of rental property for
expenses related to the rental property
and would take effect in 2011 for
reporting in 2012.
The AICPA said this would be first time
individual taxpayers who own rental
property and are not "engaged in a
trade of business" would have to pro-
vide Forms 1099-MISC. For example,
owners of vacation properties that are
rented part of the year to help reduce
costs would be covered by the new law.
"We are concerned that keeping
records to track expenses by provider,
obtaining tax identification numbers
and other information from providers
of property and services, and provid-
ing Forms 1099-MISC during January,
a month when taxpayers would not
normally be focused on tax issues,
would be extremely burdensome," the
AICPA stated.
Additionally, the AICPA said it ques-
tions the need for sending information
forms to certain providers of services,
such as utility companies.
The business implementation costs
associated with the likely generation
and receipt of millions of forms and the
potentially challenging reconciliation
processes for taxpayers should be
weighed against the uncertainty of the
benefit to be derived by the govern-
ment, the AICPA said.
Identical letters were sent to all
members of the U.S. House of
Representatives and Senate and are
available on www.aicpa.org.
AICPA Calls on Congress to Repeal
1099 Reporting Requirements
"Businesses do not need the added cost of more
regulatory requirements at a time when their efforts
must be focused on profitability and sustainability."
Source: American Institute of CPAs