President Barack Obama signed into law a bill repealing controversial legislation that would have increased dramatically the number of IRS 1099 forms that construction supply firms and other small businesses would have had to issue.
The provision required all businesses that spend at least $600 with a vendor, supplier, or contractor to fi le a 1099 tax form with the Internal Revenue Service identifying who got the money. The provision was part of last year’s health reform bill even though it didn’t have anything to do with health; rather, it was added because the requirement has been expected to generate $17 billion that would pay for health care initiatives.
The National Lumber & Building Material Dealers Association (NLBMDA) lobbied hard for the repeal and cheered the House and Senate votes. Killing the 1099 provision was the association’s top priority when its members visited Washington in mid-March.
But while NLBMDA was united against 1099, there appear to be conflicts within the group over what to do with an important issue that relates to both federal housing policy and federal government’s need to cut spending– the mortgage interest deduction.
NLBMDA generally backs pro-housing policies. In February, it released a set of legislative priorities that declares in part,”We will work to promote and preserve the value of home ownership and oppose any efforts to repeal the mortgage interest deduction.” On the other hand, when NLBMDA held its legislative conference, it featured as its keynote speaker Rep. Mike Pence, R-Ind., a known opponent of the mortgage interest deduction. And after Pence spoke, NLBMDA gave him its Legislator of the Year award.
