Changes to 2012 Tax Law

by Ron P on November 21, 2010

in Homebased Business Tips, Work From Home

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I was on one of my forums that I read and one of the contributors mentioned a significant tax change in 2012 that will affect small businesses in a big way.  Here is what the post said:

“Beginning in 2012, businesses are required to issue 1099’s to anyone that provides them with services or that they purchase property from. This is a huge change. In other words, if you purchase office supplies, material, gas, etc from any one supplier that totals $600 or more in a year, you are required to issue a 1099 to that business or person. This has been expanded also to include corporations. It appears that even utility payments will fall under this requirement. You need to make sure your software will support this requirement so that in 2012 you will be able to comply.”

This post shocked me so I done a little research.  This is actually a small section of the health care law that passed this year.  Not sure what it has to do with health care.

Here is an article from CNN Money that explains the law:

http://money.cnn.com/2010/05/05/smallbusiness/1099_health_care_tax_change/

Hopefully this part of the health care law gets repealed before 2012.  This has the potential to be an accounting nightmare and increase small businesses owner’s workloads.  Hopefully we can make enough noise and get something done about this new tax law before 2012.

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