The Internal Revenue Service (IRS) has decided to pull the plug on a proposed requirement forcing businesses to report total receipts on their business income tax forms with the amounts that third parties, such as credit card companies or Pay Pal, report paying to merchants to reconcile merchant-card transactions.
The IRS’s original proposal, slated to take effect December 1st, 2011, would have required businesses accepting credit cards or other third-party payments, to reconcile the gross receipts they report on their tax returns with the totals that third-party payers report to them using a new 1099-K information-reporting form.
After business groups repeatedly approached the IRS on the feasibility of the new requirement and the sheer volume of increased paperwork that would be involved in this new reporting, IRS delayed the proposed date of implementation by one year to December 31st, 2012, then removed the program altogether earlier this month. MORE
Several members of congress are working to ensure the IRS does not attempt to resurrect this proposal in future years. Earlier this month, Senate Finance Committee members John Thune (R-S.D.) and Maria Cantwell (D-Wash.) introduced a Senate bill, after Reps. Aaron Schrock (R-Ill.) and Bobby Schilling (R-Ill.) introduced the same bill in the House.
Tags: 1099-k, IRS, taxes, vgm club