CONGRESS REPEALS TAX PROVISION IN HEALTH CARE REFORM LAW
Congress took a final step in repealing a portion of the health care reform law on April 5, 2011, when the Senate voted to approve legislation (H.R 4) that will rescind a controversial tax-reporting requirement. The House passed the same measure in early March 2011, and the bill will be sent to the White House, where President Barack Obama was expected to sign it into law.
The measure repeals a provision that would have required all businesses to file 1099 tax forms for transactions of $600 or more. The congressional Joint Committee on Taxation estimated that the 1099 provision would increase federal revenue by $17.1 billion over 10 years. The repeal proposal as passed by the House and Senate would offset the revenue loss by increasing rates that individuals or families must use to pay back federal subsidies for health care coverage. Under the health care reform law, any individual or family earning less than four times the federal poverty level will be eligible for the health coverage subsidy beginning in 2014.
These subsidies will be provided on a sliding scale to help offset the cost of health care coverage purchases through state health care exchanges. However, any individual or family whose income increases above 400 percent of the poverty level (a threshold of $44,000 per year for individuals and $88,000 for families) will be required to repay all or part of the subsidy that they received.