President Signs Repeal of Expanded 1099 Requirements
On April 14, President Barack Obama signed into law the Comprehensive 1099 Taxpayer Protection and Repayment of Exchange Subsidy Overpayments Act of 2011 (H.R. 4; 1099 Act), which repeals both the expanded Form 1099 information reporting requirements mandated by last year's health care legislation and also the 1099 reporting requirements imposed on taxpayers who receive rental income enacted as part of last year's Small Business Jobs Act (P.L. 111-240). The Senate approved the bill on April 5, and the House voted in favor of it on March 3.
As a result of the repeal, the 1099 reporting rules continue unchanged: Namely, under Sec. 6041(a), "All persons engaged in a trade or business and making payment in the course of such trade or business to another person" of $600 or more must report the amount and the name and address of the recipient to the IRS and to the recipient. The Code applies this requirement to payments of "rent, salaries, wages, premiums, annuities, compensations, remunerations, emoluments, or other fixed or determinable gains, profits, and income," and the Treasury regulations add, "commissions, fees, and other forms of compensation for services rendered aggregating $600 or more" as well as interest (including original issue discount), royalties and pensions (Regs. Sec. 1.6041-1(a)(1)(i)).
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