Posted by Katie Vlietstra - In a move to alleviate growing concern within the small business community, the IRS announced last week that it would not require reconciliation on the 2012 form nor do they intend to require reconciliation in the future. Popularly dubbed 1099-K, the IRS would have required all business, including sole-proprietors, to reconcile credit card transactions.
The NASE strongly advocated against the 1099-K line as it placed a significant burden on the tax filer and would potentially create an misguided audit target for the IRS. While we are pleased with the announcement, the NASE still supports legislation in both the Senate and the House that would restrict the IRS from reversing its decision and require reconciliation in the future.
Read more about the NASE's position here. The IRS updated FAQ can be found here.