On Thursday, the House Ways and Means Committee approved a bill to repeal new 1099 reporting requirements. The Senate passed a repeal bill on February 2. President Obama wants to sign a repeal bill. So we're all set for the repeal of the much hated 1099 requirements?
Well, maybe not. There'sa revenue figure attached to the original legislation, and if Congress repeals the 1099 rules they have to make up the lost revenue. The Senate - with a Democratic majority - paid for repeal by authorizing the Office of Management and Budget to cut up to $44 billion from the budget, without specifying what should be cut. Oh, except that the OMB can't cut adminsitrative costs for Social Security.
Now the House - with a Republican majority - is paying for the repeal by increasing recapture penalties on the health care credit passed as part of Health Care Reform last year. Since one of the 1099 rules the House is repealing came from the Health Care Reform law, its sort of a twofer for the House.
The repeal can't be signed into law with the two chambers wanting different ways to pay for it, so the House and Senate will have to negotiate a compromise. If they can't, the repeal dies and the 1099 reporting requirements stay in place.
And you stay tuned!