{
  "id": "R41782",
  "type": "CRS Report",
  "typeId": "REPORTS",
  "number": "R41782",
  "active": true,
  "source": "EveryCRSReport.com",
  "versions": [
    {
      "source": "EveryCRSReport.com",
      "id": 386579,
      "date": "2011-04-28",
      "retrieved": "2016-04-06T22:05:45.310209",
      "title": "1099 Information Reporting Requirements and Penalties: Recent Legislative Activity",
      "summary": "Taxpayers are seen as more likely to report items of income on their tax returns if they know that a third party has reported it to the Internal Revenue Service (IRS); if follows, therefore, that expanding information reporting requirements under the Internal Revenue Code (IRC) can improve the collection of federal tax revenue. However, as those requirements are expanded, those who must comply with the requirements generally will face an increased administrative burden. This tension between the desire to improve tax compliance and the concomitant burden imposed on taxpayers was recently highlighted after expansions of the reporting requirements in IRC \u00a7 6041 were met by protests that the changes imposed too great a burden, particularly on small businesses. As a result of these objections, the expansions to the information reporting requirement were repealed shortly after they were enacted.\nIRC \u00a7 6041 requires payments totaling at least $600 in a single calendar year to a single recipient to be reported to the IRS. The required return is generally a Form 1099, which is prepared by the entity making the payment and identifies to whom payment was made, the amount of the payment, and the general reason for the payment. The form is filed with the IRS and a copy is provided to the payee. The form is required only when the payer is considered to be engaged in a trade or business and has made the payment in connection with that trade or business.\nThe scope of IRC \u00a7 6041 was expanded by both the Patient Protection and Affordable Care Act (PPACA; P.L. 111-148) and the Small Business Jobs Act of 2010 (P.L. 111-240). Section 9006 of PPACA would have made payments to corporations and payments for goods or other property subject to reporting. Section 2101 of the Small Business Jobs Act would have made most landlords subject to the reporting requirements of IRC \u00a7 6041. The expansions made by both bills were subsequently repealed by the Comprehensive 1099 Taxpayer Protection and Repayment of Exchange Subsidy Overpayments Act of 2011 (P.L. 112-9).\nThe Small Business Jobs Act also increased the penalties for failure to file an information return (IRC \u00a7 6721) and the penalties for failing to provide a copy of the information return to the payee (IRC \u00a7 6722). These changes have not been repealed and will apply to any information returns required to be filed after December 31, 2010.",
      "type": "CRS Report",
      "typeId": "REPORTS",
      "active": true,
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      "topics": []
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}