2012

According to the Mayan calendar, the world will come to an end in 2012. Books and movies have been written about how this will happen… asteroid impact, alien invasion, hypervolcanoes, you name it.

Maybe they were just predicting the U.S. economy:

In 2012, every business, including sole-proprietorships, will have to issue a 1099 to anyone from whom it buys $600 worth of goods or services. The IRS’s Tax Advocate Service says, “For example, if a self-employed individual makes numerous small purchases from an office supply store during a calendar year that total at least $600, the individual must issue a Form 1099 to the vendor and the IRS showing the exact amount of total purchases.”

When I try to explain this to business groups, they invariably reply, “No, that can’t possibly be right. You mean if I buy $600 worth of paper from Wal-Mart in the course of a year I have to get their IRS number, the address of the corporate accounting office, send them a 1099 and another copy to the IRS?” Yep. That’s exactly what it means. “What does this have to do with health care? What is wrong with these people?”

I don’t know, but the Tax Advocate Service estimates 40 million businesses will be affected. And no money was appropriated to cover the cost.

Source: Greg Scandlen, Consumer Power Report

Comments

  1. Chris Farris says:

    All I can say to this is every American should comply with these provisions and instigate a DDOS attack on the IRS this April.

    They’ll be processing the 2010 Tax Year for the next decade.

  2. In my opinion I’d characterize the 1099 issue as either (i) a rear-guard action that will require Republicans to expend energy / political capital to repeal (thus depriving them of said energy to reduce effects of Obamacare), or (ii) a throw-away that allows politicians of both parties to claim a pro-business victory when the 1099 portion of the law is repealed. Should the Republicans call the bluff and not even try to repeal? That would be fun to watch.

  3. “According to the Mayan calendar, the world will come to an end in 2012.”

    That’s like saying: According to the Gregorian calendar, the world comes to an end on December 31st, every year. The Mayan calender makes no predictions about the end of the world. It just runs out. Like every other calendar.

    By the way. The Mayans did make an actual prediction about the end of the world. According to them, it should have happened before the end of the 20th century.

    I know this has nothing to do with your post. I’m just tired of this nonsense.

  4. Nota Taxlawyer says:

    Sorry, but you are wrong on two accounts. The Mayan calendar is based on the long count (they used base-20 numbers). Their current calendar ends in 2012, not the end of the world. No where in Mayan texts does it mention this being the end date of the world. Second, the definition of business property as it relates to this tax code is any property used directly in the manufacture of goods or services for sale to a buyer (this would actually include plant and equipment, vehicles, etc unless specifically covered under a separate rule). So you WOULD need to cut a 1099 to Walmart for $600 worth of paper if you were, say, a greeting card manufacturer. If you use the paper to print a contract, bill, email, etc. no you would not.

  5. What do you mean in 2012? That is the case currently. AFAIK it doesn’t apply to buying things from your local grocery store. It is more intended for contract type work. I would question that source and would like to see where they are getting it from.

  6. Actually, it’s just the Mayan calendar that ends in 2012. There are some archeologists that have drawn apocalyptic implications from this finding.

  7. I’m not sure about the end of the world, but I certainly hope 2012 is the end of employment for the present crop of pseudo-intellectuals coming up with these half-baked policies. They have absolutely NO CLUE about what it takes to make an economy function, or how to create jobs. Instead they seem to think that businesses exist to provide jobs with nice benefits so that people will have someplace to go everyday.

    A business creates a job for one reason: because there is a NEED FOR LABOR. Place additional burdens on that business, and it will either have to raise its prices (making it less competitive in the marketplace), or it will have to reduce costs elsewhere (stifling business growth and demand for future labor). It may even have to do both — or close its doors altogether.

    I suppose then we can all go to church or to the local welfare office to see who might provide for “The Common Good”, whatever that might be. Perhaps a few handouts from all those big stashes of money borrowed from China.

  8. This is part of why I moved my $30 million/year software business to Chile this year and laid off all my US staff.

  9. Two things. First, the Mayans do *NOT* predict the end of the world. They predict the end of an age, whence a new age will start anew. They use the word “world” metaphorically, not literally.

    Second, I seriously doubt that filling out 1099s for $600 payments to someone or something for services rendered is going to break the U.S. economy. In fact, issuing 1099s for this is, or at least should be, quite common knowledge. Heck, *I* knew of this back in 1999 when I set out for the first time as a contractor, and I didn’t even have to consult a tax specialist for this.

    Though, maybe, just maybe, my filling out the 1099s was the cause for the dot-com crash of 2000s. You think? Hmmm….

    So, I’m not really sure what this blog is attempting to say.

  10. For what it’s worth, the Mayan calendar does NOT predict the end of the world in 2012. Dec. 21, 2012 is simply the end of the 13th b’ak’tun(fundamental unit on their long count calendar). The next logical ending for the calendar would not have been a year later but a b’ak’tun later or about 2406. If you had been carving calendars in stone in the 17th century, would you have wanted to stop in 2012 or 2406?

    December 21, 2012 just marks the transition from the current 13th b’ak’tun to the 14th. It is cause of a great celebration…sort of like new years on steroids.

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