Paperwork requirement will hurt small businesses
To the editor:
Do the citizens of Cape Coral know that when Congress passed the Health Care Reform Act last March, they inserted a seemingly insignificant section that will eventually have sweeping implications? It will increase the accountability for all Cape Coral business taxpayers to keep accurate records and make it more difficult for business to claim improper business expenses to offset revenues during the tax year starting in 2012. Specifically Section 9006, which amends Section 6041 of the IRS Code, of this act places an additional paperwork burden upon all business. In particular, there a new requirement for businesses to collect tax ID numbers and other information from every goods or service vendor, whether individual or corporation. In addition, businesses will be required to issue IRS Form 1099 for purchases that have a cumulative yearly total of over $600. An annual report of all 1099 issued will of course need to be sent to the IRS. A business man will also be receiving a 1099 from each business to which you sold over $600 of goods or services.
Just imagine the average Cape Coral lawn mower service having to give to Wal Mart a form 1099 for the $600 of gas he purchased in 2012. Just imagine the real estate agent needing to give a 1099 to a sign company for his real estate signs. Just imagine the average construction sub contractor needing to give to Home Depot a 1099 for the supplies and tools he purchases during a year. Just imagine any small business man having to give to B-J’s, Lowe’s, 7-11, Ford, Lee County Electric, IBM, Lee Memorial Hospital, State Farm Insurance, The Cape Coral Breeze, and on and on a 1099 for the purchase of goods or services.
This new 1099 requirement is the law. It goes into effect on Jan. 1, 2012 and probably very few Cape Coral business people are even aware of but should be for planning purposes. In order to stop this new 1099 requirement from going into affect Congress needs to take action to amend the Health Care Reform Act.
Gary E. Lewis
Cape Coral