NRF will be represented by a jeweler from Maryland when the House Small Business Committee holds a hearing next week on a provision under the health care reform law that has created a burdensome new tax reporting requirement for retailers and other businesses.
Seth Shipley, owner of Shipley’s Fine Jewelry in Hampstead, Md., is scheduled to testify before the committee on Wednesday and explain the impact on his store. The committee has called the hearing to examine how the requirement will be “an administrative burden and hinder job creation, growth and business investment.”
Last year’s Patient Protection and Affordable Care Act included a provision intended to help fund the law by requiring businesses to file a Form 1099 with the Internal Revenue Service whenever they make non-credit card payments totaling $600 or more to a vendor during a single year.
Federal law has long required a Form 1099 when a business pays $600 a year or more to an individual or unincorporated business for services, but the PPACA provision extends the requirement to include payments to corporations and to include purchases of tangible goods in addition to services. The broader reporting requirement is expected to bring in an additional $19 billion in tax revenue.
NRF has supported a number of Capitol Hill attempts to repeal the requirement, telling lawmakers in a letter earlier this week that it would “create a blizzard of reports that will needlessly bog down commerce while also swamping the IRS.”
Shipley will be one of three business owners testifying along with Representative Dan Lungren, R-Calif., who has introduced legislation to repeal the requirement. Earlier this week, the Senate amended an unrelated Federation Aviation Administration reauthorization bill to include an amendment sponsored by Senator Debbie Stabenow, R-Mich., that would repeal the requirement, and President Obama has indicated his support of repealing the provision as well. Earlier attempts to attach similar amendments to other bills this past fall failed to overcome procedural hurdles.