More than 10 million Americans are in for a rude awakening in January.
Tuesday, September 28, 2010
By Chris Neefus
(CNSNews.com) – Millions of Americans who own rental property are in for a bit of a rude awakening, beginning in January.
Congress has presented a bill to President Obama that would expand the IRS Form 1099 reporting requirements set out in the health-care reform law to include private citizens who own rental property.
The Patient Protection and Affordable Care Act, President Obama’s health care law, requires that small businesses file a Form 1099-MISC with the IRS for any goods they purchase from an outside vendor valued at over $600.
But the new bill, the Small Business Jobs and Credit Act (H.R. 5297), extends the mandate to private individuals who own property from which they receive rental income. Those people would also now have to fill out paperwork reporting any expenditure they make on that property valued over $600 for the year.
Section 2101 of the bill accomplishes this by considering anyone receiving rental income as “engaged in a trade or business.”
The provision is a revenue-raising measure designed to offset other small business tax incentives and the Small Business Lending Fund Program created in the bill. It is expected to create about $2.5 billion in revenue, according to the Joint Committee on Taxation, the nonpartisan body that determines the budget effects of bills that Congress produces. FULL STORY