muleman
Gone But Not Forgotten
Will Rental Property Owners Have to Fill Out 1099s?
While many of us are still scratching our heads as to how the innocuous-sounding Patient Protection and Affordable Care Act (a.k.a., ObamaCare) was passed, Congress is trying to add yet more layers of bureaucracy that will separate us from our freedom and our money. Congress has handed Barack Obama the Small Business Jobs and Credit Act, which expands the reporting requirements on IRS form 1099 to include individuals who own rental property. Currently, ObamaCare mandates that small businesses file a 1099-MISC for goods valued at over $600. Under the new bill, property owners would be considered to be "engaging in business" and as such would be required to report any goods or services -- valued at over $600 in a 12-month period -- associated with the property.
This may sound simple, but for the 10 million Americans affected, it will be anything but. Ryan Ellis of Americans for Taxpayer Reform illustrated it perfectly: "So imagine that you're renting out your starter condo. You pay a property manager, a plumber, a repairman, a locksmith, a condo association, etc. Imagine having to get a taxpayer identification number, order 1099-MISCs from the IRS, fill them out by hand, keep a copy for yourself, send a copy to each payee (from whom you had to get a tax ID number and other information), and then finally take your legitimate rental deduction. Then the IRS finds some hiccup somewhere, and you get audited -- all to placate an insane Congress."
While many of us are still scratching our heads as to how the innocuous-sounding Patient Protection and Affordable Care Act (a.k.a., ObamaCare) was passed, Congress is trying to add yet more layers of bureaucracy that will separate us from our freedom and our money. Congress has handed Barack Obama the Small Business Jobs and Credit Act, which expands the reporting requirements on IRS form 1099 to include individuals who own rental property. Currently, ObamaCare mandates that small businesses file a 1099-MISC for goods valued at over $600. Under the new bill, property owners would be considered to be "engaging in business" and as such would be required to report any goods or services -- valued at over $600 in a 12-month period -- associated with the property.
This may sound simple, but for the 10 million Americans affected, it will be anything but. Ryan Ellis of Americans for Taxpayer Reform illustrated it perfectly: "So imagine that you're renting out your starter condo. You pay a property manager, a plumber, a repairman, a locksmith, a condo association, etc. Imagine having to get a taxpayer identification number, order 1099-MISCs from the IRS, fill them out by hand, keep a copy for yourself, send a copy to each payee (from whom you had to get a tax ID number and other information), and then finally take your legitimate rental deduction. Then the IRS finds some hiccup somewhere, and you get audited -- all to placate an insane Congress."