2012 1099 Laws and how it relates to the $ your kid earns from livestock sale electricity generation definition

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Now, what about the corporations that come to the fairs to support the livestock auctions and run the purchases through there business as "donations" or company purchases? It would appear, as in our case, when my friend’s company writes my son a check for his fair pig, my son will be getting a 1099 from the friend’s company to show who he paid money to my son at the county fair for a hog. Son in turn, in order to offset his "earnings" from the hog will then need to send a 1099 to the pig grower he bought the pig from because he paid more than 600.00 for the hog at the sale, the feed mill if more than 600.00 and any other expense relating to the growing of this pig for more than 600.00. NOw we get 2 good pigs. We pay about 1000.00 to 1500.00 for theses show hogs. Friend is very genoerous and pays some well at auction so it is about a break even deal so the profit/loss is pretty even so my question for you cattle guys is this;

If a show steer costs a child 5000.00. They have a good year showing and have kept track of feed,hauling, miles and all expenses related to the show steer. It has been a great year and they had a ball winding up at the State Fair where the animal goes on the carcass truck and purchased by the kill buyer for about 1500.00. Since the kill buyer pays the child over 600.00 for the animal, the kill buyer must issue a 1099 to child to show where the money went for the steer because that is what the government wants us to do, the child will file taxes because he has a 1099. After he deducts all of his expenses and he will show a loss(as so many of us do but would not trade the experience for the world), how much do you think the government will be paying back to our kids every year?

What do we do when we set aside this money so we can have a fun hobby only to show we take a loss every year we are in it because we are not in it for the money but the experience? The government now says we can only take a loss for 5 years. Then What?

Now even if showing is a "hobby", you are allowed to deduct the expenses you inccurred while doing your "hobby" so you don’t have to be a corporation but since a business has purchased something from your child over the 600.00 limit, your child must file taxes on it.

Washington, DC – Senate Finance Committee Chairman Max Baucus (D-Mont.) and Senate Majority Leader Harry Reid (D-Nev.) today introduced and pledged to pass a bipartisan bill that would repeal certain new reporting requirements for businesses. Business owners have said that these new reporting rules would be too time consuming for businesses to meet. Baucus and Reid said today they hope to pass a repeal of these rules with strong bipartisan support.

“We have heard small businesses loud and clear and are responding to their concerns,” said Baucus. “Small businesses need to focus on creating good-paying jobs – not filing paperwork. Many of my colleagues on both sides of the aisle want to work with the small business community to eliminate these requirements, and it is my hope we can come together to pass legislation quickly.”

“Small businesses, the engine of our economy, told us the 1099 provision was burdensome, and we are responding quickly to ensure that they can keep running smoothly,” said Reid. “Making it easier for small businesses to thrive should be something Republicans and Democrats can agree on. I hope we can come together on common-sense reforms like these to improve a law that is already saving money and saving lives.”

The bipartisan legislation would repeal requirements for businesses to report payments made for goods and certain services to the IRS using tax form 1099. This expansion of the 1099 reporting requirements was proposed by the Bush administration to help better keep track of what businesses spend and earn, which in turn helps better keep track of tax liability. The Treasury Department estimates that more than $345 billion in owed taxes go unpaid each year. As Chairman of the Finance Committee, Baucus worked together with the Bush Administration to begin crafting the policy, which was designed to collect more of those unpaid taxes and help keep taxes lower for all taxpayers. However, after the policy was finalized late last year and became law in early 2010, more businesses owners became aware of the new paperwork requirements and raised concerns about the resources that would be required to complete the forms when they would need to begin doing so in January 2012. Baucus previously introduced legislation to repeal these form 1099 reporting requirements during the 111th Congress in November 2010.

Baucus and Reid have long worked to bolster small business and provide the tools small businesses need to grow. They recently worked to pass the Small Business Jobs Act, which helps small businesses access capital, stimulates investment in small businesses and promotes entrepreneurship. Baucus and Reid said today they intend to continue partnering with the small business community to craft innovative solutions to enhance tax administration to make our nation’s tax system fairer and without raising taxes on anyone.

"… The Treasury Department estimates that more than $345 billion in owed taxes go unpaid each year. As Chairman of the Finance Committee, Baucus worked together with the Bush Administration to begin crafting the policy, which was designed to collect more of those unpaid taxes and help keep taxes lower for all taxpayers. However, after the policy was finalized late last year and became law in early 2010, more businesses owners became aware of the new paperwork requirements and raised concerns about the resources that would be required to complete the forms when they would need to begin doing so in January 2012. Baucus previously introduced legislation to repeal these form 1099 reporting requirements during the 111th Congress in November 2010."

The government needs all the money they can get. $345 billion in potential revenue is what will keep this bill from being replealed. I have spoken with our representative Joe Donnelly and while he understands the burder placed on the small business person the above number is jsut too large to ignore. The government wont give up this kind of money.