1099 reporting rule controversy: Is there another alternative? | AccountingWEB

1099 reporting rule controversy: Is there another alternative?

There's no question that the tax gap is real. The IRS estimates that almost 20 percent of the total tax liability of the nation goes unpaid every year by individuals and businesses that underreport income. Hundreds of billions of tax dollars never get paid. The 1099 reporting rule was designed to combat this shortfall, and the IRS has been given authority to hire enough people to process all of the additional paperwork and go after the taxpayers who are not paying their fair share of tax.

If the 1099 reporting rule is too difficult to follow, what alternatives do we have? Public humiliation for those who get caught underreporting isn't really our national style, although some sort of scarlet letter displayed by tax dodgers might be effective. Another alternative is to stop taxing businesses altogether. Businesses pass the cost of tax to consumers through higher prices for products and services, so the consumer ultimately pays the tax anyway. Is it time to remove corporate (all?) income tax and give serious thought to a national sales tax?.

Best regards,
Gail Perry, Editor-in-Chief

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Caleb Newquist is the Editor-in-Chief of Sift Media US, overseeing content for both AccountingWEB and Going Concern.

Prior to this role, Caleb served as the editor of Going Concern since its founding in 2009. During his time as editor, Going Concern quickly became one of the most popular and talked about websites in the accounting profession. He has been named one of Accounting Today's Top 100 Most Influential People every year since 2011 and has been published on numerous websites, including Above the Law, Deadspin, Denver Business Journal, and the Huffington Post.

Caleb is an adjunct professor of journalism the Community College of Denver in Denver, Colorado, where he teaches Internet Media.

Prior to falling bass ackwards into the media business, Caleb spent over five years working in public accounting, with more than three of those years at KPMG. Caleb received a Master of Science in Accounting from Colorado State University and a Bachelor of Science in Business Administration from the University of Nebraska at Kearney.

Caleb spends a lot of time on a bicycle and reading, but never at the same time.

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