Small Businesses Fuss Over Increased Paperwork

Small business groups lost a round on Capitol Hill Tuesday. A bill to increase lending to small businesses cleared a hurdle in the Senate but an amendment small businesses had supported failed. The amendment would have killed a reporting requirement under the new health care law that significantly increases reporting requirements.

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STEVE INSKEEP, host:

NPR's business news starts with a fight against paperwork.

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INSKEEP: A bill that would increase lending to small businesses moved forward in the Senate yesterday, but business groups were not exactly celebrating.

As NPR's Tamara Keith reports, they were focused on an amendment that failed.

TAMARA KEITH: That amendment would have eliminated part of the health-care overhaul passed earlier this year. No, we're not talking about broad requirements to offer health insurance. This was about something much more obscure: a provision that requires businesses to file a 1099 form on all expenditures of more than $600 - per year, for every vendor, even on things like office supplies and gasoline.

Bill Rys is with the National Federation of Independent Business.

Mr. BILL RYS (National Federation of Independent Business): It's going to increase their costs, and have them filling out more forms and tracking down receipts and dealing with IRS auditors. This is the kind of uncertainty in cost increases that they really don't need right now, and this burden just needs to be done away with.

KEITH: The provision doesn't kick in until 2012, but business groups are in a rush to see it disappear. There's bipartisan agreement that something should be done, but there are still partisan divisions over just what that should be.

Tamara Keith, NPR News, Washington.

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