TRSA leads successful 1099 Repeal Effort

13 Apr '11

4 min read

The Textile Rental Services Association of America (TRSA) applauded the U.S. Senate for passing legislation repealing the onerous tax form requirement produced in the Patient Protection and Affordable Care Act of 2010 (the healthcare reform bill).

TRSA made the Form 1099 repeal a priority issue at the association's 2011 Leadership & Legislative Conference in March in Washington. During the Conference, TRSA members went to Capitol Hill to address their concerns and the impact the requirement would have on their businesses. After contacting every U.S. Senate and House member and working in a small-business coalition to repeal expanded Form 1099 requirements, TRSA's extensive efforts in this endeavor paid off.

The association was encouraged Tuesday when the Senate voted 87-12 to approve the repeal. Not only does this seek to lift a specific onerous recordkeeping burden, it indicates the Senate might cooperate more with industries including textile services whose profits are likely to erode if they are subjected to costly new rules. That would have a positive impact on TRSA efforts to ensure fair, balanced regulation and pro-business labor, energy and tax policies of particular concern to the industry.

The repeal bill awaits President Obama's approval; he has not threatened to veto it. This measure removes the portion of the new healthcare reform law mandating that businesses track and report to the IRS most goods purchases totaling $600 or more in a calendar year from a single supplier. Companies would need to prepare and send a 1099 to each vendor with a copy to the Internal Revenue Service. Healthcare reform supporters like this idea because they think it can capture more than $20 billion in tax payments that vendors currently evade and this revenue would offset the cost of implementing health reform.

TRSA and other interests contend that the additional 1099s would amount to hundreds of transactions that small businesses do not have resources to track and process. The Small Business Affordable Healthcare Coalition, which includes TRSA, believes such entrepreneurs would exhaust capital funds to comply with this requirement—money that would be better used to reinvest in their businesses and create jobs.

“This issue unto itself is significant enough to justify our taking a leadership role among business interests in obtaining the repeal. Tax paperwork and compliance are already major expenses,” said TRSA Director of Government Affairs Kevin Schwalb. “But we also see this as a pivotal opportunity. Had this vote gone the other way, it might have been the start of a more adversarial relationship between the Senate and pro-business interests. Now we are optimistic that the House and Senate will work more closely together to support the policies we advocate and corner the Obama administration when it proposes needless, counterproductive business rules.”

TRSA's Hill meetings on the repeal have positioned the association to play an increasingly prominent role in such political machinations. “Working on general business issues like this expands our connections in Congress. We build relationships with newly elected representatives and reach out to veterans with whom we've not had much previous contact. Our increased visibility on these issues that affect the economy as a whole will be useful whenever we need to make our stand with Congress on matters especially significant to textile rental services operators.”

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