The American Farm Bureau Federation says provisions in the new health care law that require farms, ranches and other businesses to complete an IRS Form 1099 for any expenditure totaling more than $600 in a calendar year create an unnecessary and costly paperwork burden.
"Farmers and ranchers are already burdened with excessive paperwork that takes time away from managing their businesses," said AFBF President Bob Stallman. "The 1099 provisions require even more time and money, pushing more paper in an exercise that even the IRS's national taxpayer advocate says will do little to improve tax compliance. For small businesses like farms and ranches, this provision will drastically increase the number of Form 1099s that need to be sent each year. Farmers and ranchers will have to hire someone to do the paperwork or spend their own valuable time to do the research and fill out the forms."
Farm Bureau cites a statement from LeMaster Daniels, an accounting firm that services numerous agricultural operations across Washington State and Idaho. The firm says the number of forms that would be required for a typical cattle operation with $250,000 of gross income would increase over four fold from 16 to 68. And for a typical orchard with $175,000 of gross revenue, the number of Form 1099s required would increase from one to 19.
Farm Bureau has filed comments with the IRS calling for repeal of the provisions that are set to take effect in 2012. The federation also backs H.R. 5141 and S. 3578, bills that would repeal the Form 1099 reporting requirements.