Understandably President Obama’s attention and energy was focused on the marathon negotiations to forge a "deal" on the 2011 budget to prevent a shutdown of the federal government on April 8, but another piece of legislation was awaiting his signature during that time frame that is of prime concern to the numismatic community.
The U.S. Senate on April 5 approved H.R. 4, the measure to repeal the expanded 1099 reporting requirement contained in the massive health care legislation signed into law last year. The House of Representative approved the repeal bill about a month earlier, on March 3. With the approval of both chambers, the bill now awaits only the president’s signature to become law.
Left to stand, the 2010 provision would have been a nightmare for both coin dealers and the collector community because it would have added required reporting of "goods" (all merchandise) to services and eliminated the exemption for corporations. Specifically, coin dealers would have had to file 1099 forms on all purchases of $600 or more in value, cumulative during a given tax year. They would have been required to issue 1099 forms to other coin dealers, coin collectors, investors and even non-coin suppliers such as Office Depot, Walmart and other providers of goods and services a business would use.
Once President Obama signs the repeal, as he has indicated he would do, the reporting requirement will return to the way it was before the change in 2010. Essentially, there will be no interruption because the expanded reporting was set to begin in 2012.
The Industry Council for Tangible Assets took the lead in the numismatic community in lobbying Congress to repeal the burdensome expanded reporting requirements. We salute ICTA’s efforts and expenditures on behalf of the entire numismatic community.
When compared to other sectors that comprise what is collectively known as the small-business portion of the economy, the numismatic marketplace is small. But the costs and impact of implementing the expanding 1099 reporting would have been huge — possibly crippling in many respects.
While there is no indication that President Obama intends a veto, it is comforting to know that the repeal measure was approved in both the House and the Senate with wide enough margins to override a veto.
Keep in mind that the expanded 1099 reporting law was calculated to have raised $17 billion in revenue for the 2012 federal budget. It’s a sure bet that revenue hunters will devise more schemes in the months ahead. Vigilance is the watchword. n