A bipartisan amendment that recently passed in the United States Senate may mean good news for coin dealers, collectors and other businesses. It seeks to repeal the IRS 1099 form reporting requirement put in place by the Patient Protection and Affordable Care Act which passed and was signed into law last year.
If the new law is left unchanged, it would require all businesses and other organizations to report any goods and services valued in excess of $600 with an IRS 1099 form beginning in 2012. Consequently, many coin transactions are subject to the new stipulations.
For example, if a coin dealer purchased over $600 (even spread throughout the entire taxable year) of products from another dealer, a 1099 form would have to be issued acknowledging the transactions. The paperwork does not stop solely at businesses, however. Even if a private collector were to sell over $600 worth of coins, they would need to issue an IRS 1099 form and report in it the buyer’s name, address and even their social security number.
After many months and several attempts to strike down the 1099 reporting requirement, the US Senate passed a repeal of the measure on February 2. Senator Debbie Stabenow (D-Mich) filed an amendment to the Federal Aviation Administration Reauthorization bill to eliminate the paperwork mandate.
"Today we provided a common-sense solution for business owners so they can focus on creating jobs, not filling out paperwork for the IRS," said Senator Stabenow. "Since last year, I have worked with my colleagues on both sides of the aisle to address this problem. If left unchecked, 40 million small businesses would see their IRS 1099 paperwork increase 2000 percent."
The measure received support from both sides of the aisle. In fact, it passed through the Senate with a vote of 81-17, likely helped by the many organizations who also sought the change like the American Numismatic Association, the U.S. Chamber of Commerce and the National Association of Manufacturers.
President Barack Obama addressed the issue included in the Health Care Act during his recent State of the Union address on January 25, 2011, when he stated:
"We can start right now by correcting a flaw in the legislation that has placed an unnecessary bookkeeping burden on small businesses." That comment signals his support of the change and his likelihood to sign it into law if presented the option.
For the 1099 form reporting requirement to be appealed, the amendment must also pass in the U.S. House of Representatives and get signed by the President.