The provisions of this law were a part of the Patient Protection and Affordable Care Act (health care reform) which was passed in March of 2010. Among the provisions were a requirement for businesses which pay more than $600.00 in a calendar year to any single recipient to submit a Federal Form 1099 for each recipient, including corporations. The provisions included the requirement for those who receive income from rental property to also file these reports. Corporations have generally been exempt as they are presumed to have their own internal accounting and reporting system to report the information. The 2010 law included additional provisions, beginning in 2012, to include these same payments which were made for the acquisition of property.
Among the arguments against this law was the extremely burdensome administrative load that would be placed upon all businesses, especially the small business owner who does not have the administrative staff and software to accurately track and report the data.Â
The additional penalties in the 2010 law that related to a failure to file the reports in a timely manner were not repealed.
A recent “Journal of Accountancy” article on this subject summarizes the results of the repealed provisions, and those provisions which remain in effect.