Monday, May 10, 2010

More ObamaCare Easter Eggs

More ObamaCare Easter Eggs
By James Taranto, Wall Street Journal Opinion Editor
http://online.wsj.com/article/SB10001424052748703338004575230312985170570.html



"An all-but-overlooked provision of the health reform law is threatening to swamp U.S. businesses with a flood of new tax paperwork," reports CNNMoney.com.

Section 9006 of the health care bill--just a few lines buried in the 2,409-page document--mandates that beginning in 2012 all companies will have to issue 1099 tax forms not just to contract workers but to any individual or corporation from which they buy more than $600 in goods or services in a tax year.The stealth change radically alters the nature of 1099s and means businesses will have to issue millions of new tax documents each year.This means more work for corporate accountants. Much worse, though, is the demand on small businesses, including freelancers:

Under the new rules, if a freelance designer buys a new iMac from the Apple Store, they'll [sic] have to send Apple a 1099. A laundromat that buys soap each week from a local distributor will have to send the supplier a 1099 at the end of the year tallying up their [sic] purchases.The bill makes two key changes to how 1099s are used. First, it expands their scope by using them to track payments not only for services but also for tangible goods. Plus, it requires that 1099s be issued not just to individuals, but also to corporations.Why did they do this? Simple greed: "The idea seems to be that using 1099 forms to capture unreported income will generate more government revenue and help offset the cost of the health bill."

Fortune magazine, meanwhile, reports that "many large companies are examining a course that was heretofore unthinkable, dumping the health care coverage they provide to their workers in exchange for paying penalty fees to the government":

That would dismantle the employer-based system that has reigned since World War II. It would also seem to contradict President Obama's statements that Americans who like their current plans could keep them. And . . . it would hugely magnify the projected costs for the bill, which controls deficits only by assuming that America's employers would remain the backbone of the nation's health care system.Speaker Nancy Pelosi famously said in March: "We have to pass the bill so that you can find out what is in it." It is increasingly evident that we all would have been better off not knowing.

1 comment:

  1. This also is a good way for the government to understand who does business with whom, the supply and distribution chain, in preparation for levying a Value-Added Tax on each step of production.

    ReplyDelete

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