The National Association of Professional Insurance Agents (PIA) has joined a host of insurance trade groups asking the Senate to quickly change a health care law tax reporting provision scheduled to go into effect in 2012.
In a statement, PIA called for repeal of the provision.
Sec. 9006 of the new health care law requires businesses of all sizes, as well as governments and nonprofits, to file a 1099 form with the Internal Revenue Service reporting any purchases they make of goods or services of $600 or more in a tax year from any individual or business, including corporations.
Currently, businesses only need to file 1099s when they buy services, and only when the vendor is an unincorporated person or business.
Earlier, the Independent Insurance Agents and Brokers of America and the National Association of Insurance and Investment Advisors had joined the widespread call for repeal or modification of the provision
"This places an unacceptably onerous burden on businesses of all sizes," said Leonard C. Brevik, PIA executive vice president & CEO. "If allowed to take effect, this provision will impose a substantial reporting and paperwork burden on governments, nonprofits and businesses--especially small businesses--dramatically increasing costs."
He added, "Small business is the growth engine of the American economy, and this provision throws sand into that engine."
An amendment sponsored by Sen. Mike Johanns, R-Neb., would repeal the provision. The Johanns amendment replaces the almost $18 billion in lost revenue by adjusting the subsidies for individual purchases of health insurance.
Sen. Harry Reid, D-Nev., and Sen. Max Baucus, D-Mont., have introduced a Democratic alternative sponsored by Sen. Bill Nelson, D-Fla., that would modify rather than repeal the controversial provision.
The Democratic substitute exempts credit cards from the information reporting requirement, lifts the threshold for 1099 reporting from $600 to $5,000, and exempts firms "employing not more than 25 employees at any time during the taxable year."